Leasing License Practice Exam

What type of contracts involves parties that agree on all terms and conditions?

1. Implied contracts

2. Unilateral contracts

3. Express contracts

4. Bilateral contracts

The correct answer is: Express contracts

An express contract is characterized by the clear and direct agreement of the parties involved on all terms and conditions. These contracts are typically written or verbally articulated in a straightforward manner, making the intentions and responsibilities of each party explicit. In such agreements, both parties explicitly state their commitment and expectations, which helps to create a definitive understanding and minimizes ambiguity regarding the terms of the contract. On the other hand, implied contracts arise from actions or circumstances rather than from written or spoken words, meaning the parties may not have directly communicated their intent. Unilateral contracts involve a promise made by one party, with the other party agreeing to the terms simply through their actions, which does not involve a mutual exchange of promises. Bilateral contracts consist of a mutual exchange of promises between two parties but do not necessarily require that all terms and conditions be clearly specified, as the focus is on the exchange of promises. Hence, express contracts, with their clear terms and mutual understanding, stand out as the correct answer.