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    Types of Contracts

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    Raj went to the Napa Valley Harvest Festival, where he stopped at Tina's booth where she was selling paintings of vineyards. Raj admired a painting of vineyards, which did not appear to be for sale. Raj said to Tina, "I will give you $200 if you give me that painting right now." Tina gave Raj the painting, and Raj gave her $200 in cash. This is an example of a contract that is:
    a) Bilateral and executed. c) Unilateral and executed.
    b) Bilateral and executory. d) Unilateral and executory.

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    Solution Preview

    The correct answer is (c) Unilateral and executed.

    Why? Let's first look at the definitions of bilateral and unilateral.

    Bilateral: Both parties promise something in exchange for the other party's promise.
    Unilateral: One party promises something in exchange for performance.

    In keeping with these ...

    Solution Summary

    This solution provides an answer to the multiple choice question on a scenario about the different types of contracts and explains why the right answer is correct. It also explains the difference between executed and executory contracts.