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Asked by Michelle Marquez on Jun 16, 2024

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Brooks offers to sell four acres of land to Jennifer for $8,000 and further offers to keep the offer open for one month if Jennifer will pay him $100 for the privilege. Jennifer pays Brooks $100. Which statement describes the payment of $100?

A) An implied in fact contract has been formed.
B) A unilateral contract has been formed.
C) This created a formal contract.
D) This created an option contract.

Option Contract

A contract which grants the holder the right, but not the obligation, to buy or sell an asset at a specified price on or before a specified date.

Unilateral Contract

is a type of contract where only one party makes a promise or undertakes a performance obligation in exchange for an act by the other party, creating a binding agreement once the act is performed.

  • Distinguish between different types of contracts and their bindings such as option, unilateral, and formal contracts.
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Safia AfrozJun 17, 2024
Final Answer :
D
Explanation :
The payment of $100 by Jennifer to Brooks in exchange for keeping the offer open for a month creates an option contract. This means Jennifer has the exclusive right to accept the offer within the specified time frame without Brooks being able to revoke it.

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