Which type of contract occurs when only one party is bound to perform an act in exchange for the other party's promise or performance?

• A. Unilateral contract
• B. Executory contract
• C. Executed contract
• D. Formal contract

Answer: (A)

This tests understanding of how obligations are triggered when a contract is formed. In a unilateral contract, only one party makes a promise—inviting the other party to perform a specific act. The offeree does not promise to do anything upfront; they accept the offer by completing the requested performance. Once that performance is done, the promisor is bound to fulfill the promised consideration or reward. So the key idea is that the contract is formed by the performance itself, not by a mutual promise.

For contrast, an executory contract means duties remain to be performed by one or both sides; an executed contract means all terms have been fully performed; a formal contract refers to a contract that requires a particular form or ceremony.