Western Governors University (WGU) BUS2060 D078 Business Environment Applications I: Business Structures and Legal Environment Pre-assesment Practice Exam

The principle of consideration in contract law refers to something of value that is exchanged between parties when entering into a contract. This value can be in the form of a promise, service, or payment. In the context of the options provided, offering a lower price in exchange for a service exemplifies this principle clearly. It demonstrates a mutual agreement where one party provides a service while the other commits to a specific payment (the lower price), establishing a reciprocal exchange that is essential for a valid contract.

In contrast, signing a contract without any terms does not establish any consideration because there is no exchange or value being agreed upon. Keeping business information private involves confidentiality but does not constitute consideration since it doesn't involve an exchange of value between parties in a contractual setting. Creating a partnership agreement may involve consideration, but it depends on the specifics of the agreement. Simply creating the agreement doesn't inherently illustrate the principle of consideration without the explicit exchange of value being stated.