Introductory Business Law CLEP Prep Practice Exam

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Prepare for the Introductory Business Law CLEP Exam with our comprehensive quiz, designed to cover essential legal concepts and practices. Study effectively and boost your chances of success!

Practice this question and more.

What document must be signed by the parties involved in a contract in order to make it legally binding?

Proposal
Agreement
Verbal Promise
Certificate

The correct answer is: Agreement

A proposal is not legally binding because it is just a suggestion or an offer of a potential agreement, but it is not a final, agreed-upon contract. A verbal promise is also not legally binding because it is not written and therefore difficult to prove in case of a dispute. A certificate is typically a document that certifies the completion of a course or certain qualifications, and it is not related to contracts. An agreement, on the other hand, is a legal document that outlines the terms and conditions of a contract and is signed by all parties involved, making it legally binding. Therefore, an agreement is the most appropriate document to be signed in order to make a contract legally binding.