Introductory Business Law CLEP Prep Practice Exam

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Prepare for the CLEP Business Law Exam with flashcards and multiple-choice questions. Each question comes with hints and explanations to help you succeed. Master the content and pass your exam!

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A contract that is one sided and that benefits one party more than the other is known as what?

Bilateral contract
Unilateral contract
Voidable contract
Valid contract

The correct answer is: Unilateral contract

A unilateral contract is a legally binding agreement where only one party makes a promise to perform a certain action or fulfill a certain obligation. In this case, the promise made by one party is not reciprocated by the other party. The other options are incorrect because - A bilateral contract is a mutual agreement where both parties make promises and are bound to fulfill them. This contradicts the definition of a one-sided contract. - A voidable contract is one that can be canceled or voided by either party due to a legal defect, such as fraud or misrepresentation. This does not describe the scenario of a contract that benefits one party more than the other. - A valid contract is one that meets all the necessary legal requirements and is enforceable by law. This does not specify or relate to the concept of one party benefiting more than the other in a contract.