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Economics

The Elements of a Valid Contract: Offer, Acceptance, and Consideration

Quick fact

A contract is not valid unless it includes a bargained-for exchange of something of value (consideration) between the parties; a promise to make a gift is not enforceable because the recipient gives nothing in return.

Why this is interesting

You probably make dozens of promises every week—but what turns a simple 'I'll do it' into a legally binding agreement that a court will enforce?