actual EXAM QUESTIONS AND ANSWERS

AIC 301 - EXPANDING YOUR CLAIMS PERSPECTIVE newest actual / EXAM QUESTIONS AND ANSWERS verified/graded a+.

Which one of the following is true regarding a void contract?

Select one:

• A contract with a minor is always a void contract.
• A void contract is not legally enforceable or binding.
• A void contract is a contract in which the parties can

execute it completely unless an innocent party chooses to avoid it.

• A void contract is entered into under fraud or duress. - ----

Answers---B. A void contract is not legally enforceable or binding.

A "void" contract is not legally enforceable or binding. In contrast, a "voidable" contract is a contract in which the parties can execute it completely unless an innocent party chooses to "avoid" it.

ABC Corporation, which purchased insurance from XYZ Insurance Company, materially breached the insurance contract. Which one of the following is a right the insurer has against the insured?

Select one:

• Substantial performance
• Repudiation 1 / 3

• Tender of performance
• Nonperformance - ----Answers---D. Nonperformance

Nonperformance is a right the insurer has against the insured when a material breach occurs. A party's material breach excuses the other party's performance and immediately gives rise to remedies for breach of contract. Repudiation is a party's refusal to meet obligations under a contract.Substantial performance is the performance of the primary, necessary terms of an agreement. A tender is an offer to perform one's duties under a contract.

Susie agreed to sell grocer Marcus 1,000 jars of jelly for a total price of $2,000. Marcus breached the contract, and Susie had to find an alternate buyer. She found one who would purchase the jelly for $1,500. Susie, therefore, lost $500 because of Marcus' breaching their contract of sale. Susie has which one of the following remedies available for this breach of contract?

Select one:

• Injunction
• Damages
• Specific performance
• Contract price - ----Answers---B. Damages

Damages, as a remedy, are available if a seller appropriately resells the goods and receives less than the contract price.The difference between the contract price of $2,000 and the price on resale of $1,500 (which is $500) is the damages.These were compensatory damages which would be used to 2 / 3

indemnify Susie for the actual harm cause by the breach of contract by Marcus.

The courts will not usually uphold an assignment when it

Select one:

• Results from the assignee's material misrepresentation.
• Materially alters or varies the obligor's performance.
• Assigns the right to receive payment for the sale of goods to

a third party.

• Was created for the purpose of debt collection. - ----

Answers---B. Materially alters or varies the obligor's performance.

If an assignment materially alters or changes the obligor's performance, the courts will not uphold the assignment. The assignee's representations do not affect the validity of an assignment. Courts will uphold assignments created for the purpose of debt collection or those used by a seller to assign the right to receive payment for the sale of goods to a third party.

Mansion owner Mary, who is 85 years old, hired Larry to make a small repair to a window sash and wrote him a check for $80. Larry then modified the check to show the amount as $180 because he felt that Mary could afford it and that the repair was more complicated than he had expected. Larry is guilty of

Select one:

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