Alabama Real Estate Practice Exam 2026 - Free Real Estate Practice Questions and Study Guide

A bilateral contract is a type of contract where both parties involved are bound by the terms and obligations outlined in the agreement. This means that both parties have made mutual promises to perform certain actions or fulfill certain obligations. Option A is incorrect because in a bilateral contract, both parties are bound, whereas in a unilateral contract, only one party is bound. Option C is incorrect because a bilateral contract can be legally enforced as both parties have agreed to the terms. Option D is incorrect because a bilateral contract can apply to a variety of agreements, not just employment agreements.