Multiple choice

1. Carla Contractor Company contracts to build a house for Lisa for $500,000. The house is completed on time and is in conformity with contract specifications except that Carla’s workers forgot to put in Kohler plumbing fixtures in the master bathroom and instead mistakenly put in another slightly less expensive and not as prestigious brand. Otherwise the house is fine and is in conformity with the contract, but now Lisa refuses to pay for the construction of the house, saying the performance was defective due to the mistaken fixtures. What is the likely legal result of this dispute?

 a. Lisa is discharged from any and all contract responsibility and does not have to pay anything and can successfully sue Carla for breach of contract.

 b. Lisa can sue and prevail since under the Uniform Commercial Code Carla’s performance was not perfect.

c. Lisa must pay Carla the agreed upon contract price minus an amount to correct the defect since the “substantial performance” doctrine of the common law prevails.

d. Lisa can sue for “pain and suffering” damages since she was stressed out by the “inferior” plumbing fixtures.


2. At one time, Office Depot merged with Staples, leaving Office Max as a very small remaining competitor. This merger was deemed to be illegal pursuant to the Clayton Act because:

a. The market was defined broadly to include all stores that sell office supplies.

b. The market was defined narrowly to include just office supply “super-stores.”

c. There was the probability of a substantial lessening of competition in the market.

d. B and C.


3. Donnie makes an offer to Marie to sell his used racing bicycle for $200. Marie responds by saying “I accept at $150.” Donnie refuses and says the price is firm. Marie then says “OK, I accept at the original price.” However, Donnie sells the bike to a third party; whereupon Marie sues Donnie for breach of contract. Who is likely to prevail?

a. Marie since she accepted Donnie’s offer at $200.

 b. Marie since her initial response was merely an “invitation to offer.”

c. Donnie since his original offer was terminated by Marie’s counteroffer.

d. Donnie since the court would void the entire contract since $200 for even a used racing bike does not seem like a fair price.



4. Francis owns a small motel in Sugarloaf Key. She notices by means of public advertising that her competitors in Big Pine Key and Ramrod Key have extended by two weeks their “winter season” and thus their winter season higher rates. Francis also notices the “no vacancy” signs at her competitors’ motels. So, Francis decides to extend the winter season at her motel too. Francis has engaged:

 a. Illegal horizontal price-fixing by means of an express agreement.

b. Illegal horizontal price-fixing by means of an implied agreement

 c. Legal action by means of the doctrine of Conscious Parallelism

d. Legal action since anti-trust law does not apply to small motels, only large ones and hotels.


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