What is the exam-ready distinction?
| Official syllabus topic | Contracts: Contract Classification; Bilateral and Unilateral |
|---|---|
| Official PSI area | Contracts |
| Published weight | 19% of the 100-question national portion |
| Source edition | PSI Georgia Candidate Information Bulletin dated July 1, 2026 |
The Rule
PSI publishes a weight for the complete official area, not a guaranteed count for this individual comparison. Use the source, document, actor, event, and timing stated in the question before applying a memorized definition.
Side-by-side comparison
Read across each row. The terms are deliberately compared on identical dimensions so the difference remains clear when the exam hides the vocabulary inside a scenario.
| Decision dimension | Bilateral contract | Unilateral contract |
|---|---|---|
| Exchange | Promise for promise | Promise in exchange for requested performance |
| Acceptance | Return promise creates the contract | Completion or beginning of performance as governing law provides |
| Obligations | Both parties make enforceable promises | Promisor seeks an act rather than a return promise |
| Real estate example | Ordinary purchase agreement | Broker reward or bonus offer accepted by specified performance |
Decision rule
Georgia-specific distinction
Worked example
Scenario. A seller promises to convey title, and a buyer promises to pay the agreed price at closing.
Reason it through. Each party's promise is exchanged for the other's promise.
Answer. The purchase agreement is bilateral.
Common exam traps
- Counting duties instead of promises
- Calling every reward bilateral
- Calling a drafted form unilateral
- Confusing unilateral contract with one-sided bargaining power
Original practice questions with detailed explanations
These are original instructional questions mapped to the July 1, 2026 PSI outline. They are not copied from PSI or any live examination. Choose an answer before opening the explanation.
Question 1A seller promises to convey title, and a buyer promises to pay $300,000 at closing next month. What type of contract is this?
- A. Bilateral, because promises are exchanged
- B. Unilateral, because the deed is delivered later
- C. Unilateral, because the seller drafted the form
- D. An option, because closing is in the future
Show answer and explanation →
Answer: A. Bilateral, because promises are exchanged
A bilateral contract exchanges a promise for a promise, and both parties are bound once the return promise is made. The seller promised to convey and the buyer promised to pay. The later closing date only means performance is still ahead, which does not make the contract unilateral.
Question 2A broker announces that the first agent in the office to produce a buyer for a slow-moving listing will receive a $500 bonus. No agent promises to try. How is the broker's offer classified?
- A. Bilateral, because the broker and agents work together
- B. Void, because no agent made a return promise
- C. Executed, because the bonus amount was stated
- D. Unilateral, because it is accepted by performing
Show answer and explanation →
Answer: D. Unilateral, because it is accepted by performing
A unilateral contract promises something in exchange for a requested act rather than a return promise. The bonus is earned by producing the buyer, not by promising to try. Calling it void misses the point: no return promise is needed, because performance is the acceptance.
Question 3A purchase contract gives the buyer eight obligations and the seller only two, and both parties signed promising to perform. Why is it still a bilateral contract?
- A. Because classification turns on who drafted the form
- B. Because the test is whether promises were exchanged
- C. Because one-sided duties make it an option contract
- D. Because only a signed deed creates a unilateral contract
Show answer and explanation →
Answer: B. Because the test is whether promises were exchanged
The classification turns on how acceptance happened, and a return promise makes a contract bilateral. Both parties promised here, so the count of duties does not matter. Counting duties or noting who drafted the form confuses one-sided bargaining power with a unilateral contract.
Ready to move on?
You have this distinction down when all of these are true.
- Define every compared term without using the other term as the definition.
- Rebuild the comparison table from memory.
- State the decision rule and Georgia distinction without notes.
- Solve the worked example after changing one key fact.
- Explain the rule or fact that makes each distractor wrong.
- Answer all three original questions correctly in mixed practice on a later day.
Recommended next lesson
Continue with Addendum Versus Amendment. With formation sorted, the next page looks at the paperwork around a bilateral purchase agreement: an addendum supplements the deal when it is formed, while an amendment changes a term afterward.
Return to the complete exam-concept library or the Contracts hub.