BUSINESS ADMINISTRATION
BUSINESS LAW
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
Compensatory
|
|
|
a. Illusory
|
|
|
a. Liquidated
|
|
|
a. Nominal
|
Detailed explanation-1: -Nominal Consideration and the Law In a contract, nominal consideration is considered a slight formality of a contrived exchange. For example, Party A wants to enter a contract to give Party B $5, 000 and requests that Party B gives them a pencil in return.
Detailed explanation-2: -An example of an illusory contract would be when the speaker makes a statement such as “the seller agrees to sell all of a particular product he wants” to a buyer. Upon closer inspection of what was stated, the speaker (seller) of the promise has the choice to perform or not perform.
Detailed explanation-3: -An executory consideration takes place when an entity makes a promise to another entity and that entity does the same. Take for example a person promises to lend money to a person to purchase a car at a later date as long as the receiving party promises to pay back the borrowed funds.