Question

Which of the following is true about a wagering contract?

• A. Only one party stands to win or lose.
• B. Both parties may win or lose depending on an uncertain event.
• C. The contract is enforceable in court.
• D. It is enforceable in court with mutual consent of parties.

Hint:

Wagering contracts are generally unenforceable in court because they are seen as a form of gambling, but they are exceptions when the contract has a legitimate purpose.

Answer 1

The Correct Option is B

Step 1: Understand the concept of a wagering contract. 
A wagering contract is a type of contract where the outcome depends on an uncertain event. This means that both parties agree to bet on the outcome of an event, and one party wins while the other loses, depending on the event's outcome. 
Step 2: Key characteristics of wagering contracts.
Both parties may win or lose depending on an uncertain event. For example, a bet on the outcome of a sporting event would constitute a wagering contract. The main point is that the outcome is based on chance or uncertainty.
Wagering contracts are typically not enforceable in court as they are considered a form of gambling. 
Step 3: Conclusion.
Since both parties may win or lose depending on the event's outcome, option (2) is correct.