5-Question Learned Quiz — Class 3.2: Nick Szabo & Smart Contracts: Hardcoding Consideration

1. What is the central 'detective story' unpacked in Class 3.2 ('Nick Szabo & Smart Contracts: Hardcoding Consideration')?

A) How the centuries-old contract law doctrine of 'consideration' (quid pro quo) solved the decentralized network dilemma and made modern blockchains possible. B) How to litigate a maritime insurance claim. C) How to design a corporate logo.

2. In Section 2 ('The Smart Contract Problem: The Decentralized Dilemma'), why wouldn't a distributed network of peer computers simply run your contract code for free?

A) Without a built-in economic incentive, independent peer nodes have no reason to burn electricity and CPU cycles to verify and execute stranger's transactions. B) Because peer-to-peer networks cannot transmit text. C) Because the internet shuts down at night.

3. How did legal scholar and computer scientist Nick Szabo solve this decentralized execution dilemma?

A) By translating the legal requirement of 'consideration' (the quid pro quo exchange of value) directly into protocol-level digital payment ('gas fees') for network validators. B) By asking governments to subsidize all servers. C) By making all smart contracts non-binding.

4. In the step-by-step blockchain execution flow in Class 3.2, why do network validators receive 'gas fees'?

A) As hardcoded digitized consideration compensating them for expending real computational energy to validate and record the contract state transition. B) To pay for gasoline for delivery trucks. C) As a charitable donation with no obligation.

5. Who envisioned the 'Ricardian Contract' in 1996 (highlighted in Section 5 of Class 3.2), and what does it do?

A) Ian Grigg; it formats a legal agreement so that it is simultaneously machine-readable software and text-readable prose for human lawyers. B) David Ricardo; it calculates agricultural tariffs. C) Charles Dickens; it serializes novels.

5-Question Learned Quiz — Class 3.2: Nick Szabo & Smart Contracts: Hardcoding Consideration