New Jersey Real Estate License Exam Practice Question
Is an option to purchase considered to be a form of contract?
Correct Answer: B
Rationale: An option to purchase is indeed a form of contract because it requires consideration to be valid (Option B). Consideration refers to something of value exchanged between parties, which is essential for any contract to be enforceable.
Option A is misleading; while terms may be finalized after exercising the option, this does not negate the existence of the initial contract. Option C is incorrect; an option can be a written and signed agreement, which is a common practice in real estate. Option D is also wrong; an option can be executed, meaning it can be acted upon, thus affirming its status as a contract.
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