A Bilateral Contract is defined as:

A Bilateral Contract is defined as:

• A. When only one party promises to do something
• B. When both promise to do something
• C. An implied contract
• D. A contract requiring notarization

Answer: (B)

In a bilateral contract, both parties commit to perform—each side makes a promise that serves as the consideration for the other. This mutual exchange creates the contract, so it is formed when the promises are exchanged, not just by one party’s action. For example, a buyer promises to pay money and a seller promises to deliver goods; those two promises bind both sides. The other descriptions don’t fit as the defining idea. A unilateral contract involves a promise from one party that is fulfilled by the other party’s performance. An implied contract is formed by conduct and the surrounding circumstances rather than explicit promises. Notarization is not what creates a contract.

In a bilateral contract, both parties commit to perform—each side makes a promise that serves as the consideration for the other. This mutual exchange creates the contract, so it is formed when the promises are exchanged, not just by one party’s action. For example, a buyer promises to pay money and a seller promises to deliver goods; those two promises bind both sides.

The other descriptions don’t fit as the defining idea. A unilateral contract involves a promise from one party that is fulfilled by the other party’s performance. An implied contract is formed by conduct and the surrounding circumstances rather than explicit promises. Notarization is not what creates a contract.