Certified Residential Appraiser Practice Exam

In a unilateral contract, how many parties make a promise?

1. Two parties.

2. None of the parties.

3. Only one party.

4. Three or more parties.

The correct answer is: Only one party.

In a unilateral contract, only one party makes a promise, which is the defining characteristic that sets it apart from bilateral contracts. In this type of agreement, one party offers something of value or makes a promise, while the other party is not obliged to respond or to make a promise in return. For instance, a classic example is a reward contract, where one person offers a reward for finding a lost pet; only the person offering the reward is making a promise. The individual who finds and returns the pet is not obligated to do so; they can choose to accept the offer or not. This concept is essential in understanding the nature of contractual agreements and the obligations associated with them, particularly in residential appraisal contexts where understanding legal frameworks can impact property transactions. The other options reflect misconceptions about contracts: having two parties would describe a bilateral contract where both sides make promises, saying none of the parties make a promise does not align with the nature of a unilateral contract, and stating that three or more parties are involved is not accurate as a unilateral contract is defined by the promise of a single party.