Business Law Solved MCQs

These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Business Administration (BBA) , Bachelor of Financial Markets (B F M) , Union Public Service Commission (UPSC) , Indian Administrative Service (IAS) , Common Law Admission Test (CLAT) .

Take a Test

1.	An agreement enforceable by law is
A.	agreement
B.	contract
C.	offer
D.	promise
Answer» B. contract

2.	Every promise and every set of promises, forming the consideration for each other is an
A.	agreement
B.	offer
C.	contract
D.	acceptance
Answer» A. agreement

3.	In a contract of indemnity the right of the indemnifier is similar to that of the:
A.	debtor
B.	creditor
C.	surety
D.	agent
Answer» C. surety

4.	In a contract of indemnity, minimum no of parties are
A.	4
B.	3
C.	2
D.	1
Answer» C. 2

5.	The sale of goods act is of:
A.	1903
B.	1923
C.	1930
D.	1932
Answer» C. 1930

6.	Seller is a person who
A.	sells
B.	buys
C.	debtor
D.	transferee
Answer» A. sells

7.	Document of title includes
A.	business reports
B.	railway receipt
C.	cash memo
D.	email
Answer» B. railway receipt

8.	A person coming forward to accept after it has been dishonoured is called:
A.	acceptor for honour
B.	acceptor for paying
C.	payment for honour
D.	holder
Answer» A. acceptor for honour

9.	Protest for better security is done for publicity stunt.
A.	true
B.	false
C.	attention
D.	fun
Answer» B. false

10.	When an instrument is lost, it is presumed that it was duly stamped
A.	true
B.	false
C.	not inchoate
D.	inchoate
Answer» A. true

11.	Which one of the following element is not necessary for a contract ?
A.	Competent parties
B.	Reasonable terms and conditions.
C.	Free consent
D.	Lawful concentration
Answer» B. Reasonable terms and conditions.

12.	An agreement becomes a contract if :
A.	It is by free consent of the parties.
B.	Parties are competent.
C.	It is enforceable by law.
D.	None of the above .
Answer» C. It is enforceable by law.

13.	In a standardized contract :
A.	The individual has no choice but to accept and sign on
B.	The individual must be protected in contract.
C.	The agreement is without consideration.
D.	None of the above.
Answer» A. The individual has no choice but to accept and sign on

14.	The correct sequence in the formation of a contract is :
A.	Offer, acceptance, agreement, consideration.
B.	Agreement, consideration, offer,acceptance.
C.	Offer , Consideration, acceptance, agreement.
D.	Offer,acceptance, consideration, agreement.
Answer» D. Offer,acceptance, consideration, agreement.

15.	A sells, by auction to B a horse which A knows to be unsound. A says nothing to B about the horse unsoundness. A does :
A.	Fraud
B.	Misrepresentation
C.	No fraud
D.	Undue Influence
Answer» C. No fraud

16.	A petient in a lunatic Asylum who is at intervals of sound mind :
A.	May not contract.
B.	May contract.
C.	May contact during those intervals when he is of sound mind.
D.	May contract only after he becomes completely of sound mind .
Answer» C. May contact during those intervals when he is of sound mind.

17.	Which is not the correct statement ?
A.	If consent is the result of coercion, the agreement is
B.	If a party is minor, the agreement is void .
C.	If the object of an agreement is unlawful, the agreement is void.
D.	If the consideration of an agreement is unlawful, the agreement
Answer» A. If consent is the result of coercion, the agreement is

18.	What is the purpose behind the enactment of Sale of Goods Act, 1930?
A.	To define the laws relating to the sale of goods
B.	To consolidate and amend the laws relating to the sale of goods
C.	To consolidate, amend and define the laws relating to the sale of goods
D.	To define and amend the laws relating to the sale of goods
Answer» D. To define and amend the laws relating to the sale of goods

19.	Section 2(1) of Sale of Goods Act defines ‘buyer’ as:
A.	Person who buys goods and services
B.	Person who agrees to buy goods
C.	Person who buys or agrees to buy goods
D.	Person who buys or agrees to buy goods and services
Answer» C. Person who buys or agrees to buy goods

20.	Before the enactment of Sale of Goods Act, the provisions regarding Sale of
A.	Indian Contract Act, 1872
B.	Indian Registration Act, 1908
C.	Transfer of Property Act, 1882
D.	Indian Partnership Act, 1932
Answer» A. Indian Contract Act, 1872

21.	Which of the following cannot be said to be included in the term “goods” defined under section 2(7) of the Sale of Goods
A.	Stock
B.	Shares
C.	Growing crops
D.	Actionable claims
Answer» D. Actionable claims

22.	The voluntary transfer of possession from one person to another is called
A.	Transfer
B.	change of possession
C.	Delivery
D.	None of above
Answer» C. Delivery

23.	Which of the following is not the right of an unpaid seller under Sale of Goods Act, 1930:
A.	Right of lien on goods for the price while the goods are in possession of seller.
B.	Right of stopping the goods in transit, in case of insolvency of buyer
C.	Right of resale as limited by the Act
D.	Right of withholding delivery where the property in the goods has passed to the buyer
Answer» D. Right of withholding delivery where the property in the goods has passed to the buyer

24.	Future goods means goods to be manufactured or produced or acquired by the seller
A.	In future prescribed time
B.	after making of contract
C.	before making of contract
D.	none of the above
Answer» B. after making of contract

25.	Bearer cheques are also known as------ cheques.
A.	Crossed
B.	General
C.	Special
D.	Open
Answer» D. Open

Business Law Solved MCQs

An agreement enforceable by law is

Every promise and every set of promises, forming the consideration for each other is an

In a contract of indemnity the right of the indemnifier is similar to that of the:

In a contract of indemnity, minimum no of parties are

The sale of goods act is of:

Seller is a person who

Document of title includes

A person coming forward to accept after it has been dishonoured is called:

Protest for better security is done for publicity stunt.

When an instrument is lost, it is presumed that it was duly stamped

Which one of the following element is not necessary for a contract ?

An agreement becomes a contract if :

In a standardized contract :

The correct sequence in the formation of a contract is :

A sells, by auction to B a horse which A knows to be unsound. A says nothing to B about the horse unsoundness. A does :

A petient in a lunatic Asylum who is at intervals of sound mind :

Which is not the correct statement ?

What is the purpose behind the enactment of Sale of Goods Act, 1930?

Section 2(1) of Sale of Goods Act defines ‘buyer’ as:

Before the enactment of Sale of Goods Act, the provisions regarding Sale of

Which of the following cannot be said to be included in the term “goods” defined under section 2(7) of the Sale of Goods

The voluntary transfer of possession from one person to another is called

Which of the following is not the right of an unpaid seller under Sale of Goods Act, 1930:

Future goods means goods to be manufactured or produced or acquired by the seller

Bearer cheques are also known as------ cheques.

Which of the following is not a negotiable instrument

Features of Negotiable instruments are -

Holder in due course means any person-

Cheque can be of types and crossing of cheques can be of types.

What are the limits of number of members in a Private Company?

A public company must have at least————- directors whereas a private company must have at least ——————-

The registered office clause of memorandum of association contains

Which documents contains the regulations relating to the internal management of a

………….meeting is the first meeting of the members of the public company after

Who can endorse the negotiable

A Bill of exchange contains —

Memorandum of Association does not include.

Quorum for general meeting for private and public companies.

What do you mean by symbolic possession ?

What does Caveat emptor means?

26.	Which of the following is not a negotiable instrument
A.	Bill of exchange and cheque
B.	Postal Order & Currency note
C.	Promissory note and cheque
D.	Promissory note & Bill of exchange
Answer» B. Postal Order & Currency note

27.	Features of Negotiable instruments are -
A.	Written and signed
B.	Recovery
C.	Freely transferable
D.	All of the above
Answer» D. All of the above

28.	Holder in due course means any person-
A.	Drawing the instrument
B.	who for consideration became the possession of promissory note
C.	to whom order the money is directed to paid
D.	none of the Above
Answer» B. who for consideration became the possession of promissory note

29.	Cheque can be of types and crossing of cheques can be of types.
A.	three, two
B.	two, two
C.	two, three
D.	three, three
Answer» B. two, two

30.	What are the limits of number of members in a Private Company?
A.	Fifty
B.	Seven
C.	Twenty
D.	Two hundred
Answer» D. Two hundred

31.	A public company must have at least————- directors whereas a private company must have at least ——————-
A.	3;2
B.	23
C.	25
D.	810
Answer» A. 3;2

32.	The registered office clause of memorandum of association contains
A.	The name of the state in which the registered office of the company is to
B.	The name of the city/town only and not that of the state.
C.	The name of registrar of companies
D.	The complete postal address.
Answer» A. The name of the state in which the registered office of the company is to

33.	Which documents contains the regulations relating to the internal management of a
A.	Memorandum of Association
B.	Articles of Association
C.	Both (a) and (b)
D.	None
Answer» B. Articles of Association

34.	………….meeting is the first meeting of the members of the public company after
A.	board
B.	annual general
C.	departmental
D.	statutory
Answer» D. statutory

35.	Who can endorse the negotiable
A.	Maker of the
B.	older of the
C.	Drawee
D.	Both of A and B
Answer» D. Both of A and B