-Definitions:
1. Proposal :- When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal.
2. Promise :-
When the person to whom the proposal is made signifies his assent thereto, the proposalis said to be accepted. A proposal, when accepted, becomes a promise.
3. Consideration :–
When, at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such Act or abstinence or promise is called a consideration for the promise.
4. Agreement :-
Every promise and every set of promises, forming the consideration for each other, is an agreement.
5. Contact :-
An agreement enforceable by law is a contract.
F.Y.B.Com - Notes 