1. Most contracts are discharged by.
(a) Agreement of the parties
(b) Full performance
(c) Failure of conditions
(d) Commercial impracticability
(e) A material breach
2. Big Co., a construction company, builds a grocery store. The contract calls for a final price of $5 million. Big Co. incurred $4.5 million in costs and stands to make a profit of $500,000. On a final inspection, the grocery store owner is upset. His blueprints called for 24 skylights, but the finished building has only 12. Installing the additional skylights would cost $100,000. Big Co. made no other errors. How much must the grocery store owner pay Big Co.?
(a) $5,000,000
(b) $4,900,000
(c) $4,500,000
(d) $0
3. Lenny makes K2, a synthetic form of marijuana, in his basement. He signs an agreement with the Super Smoke Shop to deliver 1000 cans of K2 for $10,000. After the contract is signed, but before the delivery, Super Smoke Shop's state legislature makes the sale of K2 illegal. Lenny's contract will be discharged because of ______________________.
(a) True impossibility
(b) Commercial impracticability
(c) Frustration of purpose
(d) None of the above
4. A manufacturer delivers a new tractor to Farmer Ted on the first day of the harvest season. But, the tractor will not start. It takes two weeks for the right parts to be delivered and installed. The repair bill comes to $1000. During the two weeks, some acres of Farmer Ted's crops die. He argues in court that his lost profit on those acres is $60,000. If a jury awards $1000 for tractor repairs, it will be in the form of _____________ damages. If it awards $60,000 for the lost crops, it will be in the form of ___________________ damages.
(a) Direct; direct
(b) Direct; consequential
(c) Consequential; direct
(d) Consequential; consequential
(e) Direct; incidental
5. Julie signs a contract to buy Nick's 2002 Mustang GT for $5,000. Later, Nick changes his mind and refuses to sell his car. Julie soon buys a similar 2002 Mustang GT for $5,500. She then sues Nick and wins $500. The $500 represents her _________________.
(a) Expectation interest
(b) Reliance interest
(c) Restitution interest
(d) None of the above