Business Laws MCQs [set-5]

101. A contract is made where:

A. X agrees with Y to discover a treasure by magic.

B. X bids at a public auction

C. A sees a sea

D. A sit in a public Omni bus.

o m
.c
Answer: D
te
a
M
102. In case of void agreements, collateral transactions are
q
A. Also void c
B. Unenforceable
M
C. Not affected

D. Illegal

Answer: C

103. The delivery of goods by one person to another for some purpose,
upon a contract and that they shall, when the purpose is accomplished, be
returned or otherwise disposed of by accounting to the directions of the
person delivering them, then it is called:

A. Contingent contract

B. Bailment

C. Pledge

D. Contract of indemnity

Answer: B

104. A, a minor bought 11 expensive coasts from B. he was, at that time,

adequately provided with clothes, but B did not know this fact. In such a

Download more at McqMate.com

case

A. Minor is personally liable to pay for the coast

B. Minor’s property can be attached for payment

C. Minor is liable since he has Misled into supply of coats

D. Minor is not liable at all

Answer: C

o m
105. A husband, by a registered agreement promised to pay wife Rs 5,000
p.m. there was no consideration moving from the wife to the husband.
This contract is
.c
te
A. Void
a
B. Illegal
q M
C. Valid c
D. Unenforceable
M
Answer: C

106. In Indian Contract Act, the term consensus ad idem means

A. Parties under a mistake

B. Parties under the free consent

C. Parties agreeing upon the same thing in same sense

D. None of these

Answer: C

107. Sonia contracts with Anshul to buy a necklace, believing it is made of

pearls whereas in fact it is made of imitation pearls of no value. Anshul
knows that Sonia is mistaken and takes no steps to correct the error. Now
Sonia wants to cancel the contract based on fraud. Which of the following
statement is correct?

A. Sonia can cancel the contract alleging fraud

Download more at McqMate.com

 B. Sonia cannot cancel the contract

C. Sonia can cancel the contract alleging undue influence

D. Sonia can claim damages

Answer: D

108. Which of the following is false with respect to minor entering a

contract?

A. An agreement with or by a minor is void ab initio

o m
B. A minor can be a beneficiary of a contract
.c
te
C. The guardian of a minor is responsible for his acts

a
M
D. A minor cannot ratify a contract on attaining majority

q
Answer: C
c
M
109. Anuj agrees to pay Rs10,000 to Manoj if a certain ship returns within a
year. However, the ship sinks within the year. In this case, the contract
becomes:

A. Valid

B. Void

C. Voidable

D. Illegal

Answer: B

110. A invites B for coffee in Coffee day Restaurant and B accepts the
invitation. On the appointed date, B goes there but A does not come. In
this case

A. B has no remedy against A.

B. B has to wait for another invitation from A.

C. B can sue A for not honoring his words.

D. A has to invite B again, to keep the promise.

Answer: A

Download more at McqMate.com

111. Where a contract has to be inferred from the conduct of parties, it is
called

A. Express contract.

B. Implied contract.

C. Tacit contract.

D. Unlawful contract

Answer: B

o m
.c
112. Voidable contract is one
te
a
A. Which is lawful.

q M
B. Which is invalid.
c
M
C. Which is valid if it is not avoided by the party entitled to do so.

D. Which is unlawful.

Answer: C

113. Undue influence can be presumed between

A. Guardian and Ward

B. Mother and Daughter

C. Doctor and Patient

D. All of the above

Answer: D

114. Wagering Agreement is a _____________ agreement

A. Valid

B. Voidable

C. Void

D. Illegal

Answer: C

Download more at McqMate.com

115. A minor was facing a criminal prosecution for smuggling drugs. He
borrowed Rs. 5000 to hire an advocate to defend him in the court of law.
What is the remedy available to the creditor if the minor does not return
the money on his own?

A. The creditor cannot recover the amount from the minor since a contract with a minor is void ab
initio

B. The amount of loan can be recovered from minor’s property since it is a loan for necessaries

majority
o m
C. The creditor can recover his amount of loan from the minor on his (minor’s) attaining the age of

.c
D. The creditor can recover his amount from the parent or guardian of the minor

te
Answer: A
a
q M
c
116. Future goods mean goods to be manufactured or produced or
acquired by the seller
M
A. In future prescribed time

B. After making of contract

C. Before making of contract

D. None of above

Answer: A

117. A sold a stolen car to B which was subsequently recovered by the

police form B's possession and he (B) was forced to return the same to
the true owner. Here, there is breach of implied condition as to

A. Merchantability

B. Fitness for buyer's purpose

C. Title

D. None of these

Answer: C

118. Where the goods are sold by description, there is an implied

Download more at McqMate.com

condition that the goods shall

A. Be fit for buyer's purpose

B. Free from any defects

C. Correspond with the description

D. Free form any encumbrance

Answer: C

o m
119. As per the doctrine of caveat emptor incorporated in Section 16, there
is no implied conditions or warranty in a contract of sale as to the
.c
A. Merchantability.
te
B. Wholesomeness. a
q M
C. Quality or fitness for buyer's purpose.
c
D. None of these.

Answer: C
M
120. Where the seller wrongfully neglects or refuses to deliver the goods
to the buyer, the buyer may sue for:

A. Damages for non-delivery

B. Damages for non-acceptance

C. Specific performance

D. Compensation

Answer: A

121. The unpaid seller has right of stoppage of goods in transit only where
the buyer

A. Becomes insolvent

B. Refuses to pay price

C. Acts fraudulently

Download more at McqMate.com

 D. All of these

Answer: A

122. An unpaid seller is having rights against

A. Goods only

B. The buyer only

C. Both goods and buyer

D. None of the above

o m
Answer: C
.c
te
123. Seller has right of resale where a

q M
A. Goods are perishable
c
M
B. Seller has reserved such right.

C. Seller gives notice

D. All of these.

Answer: D

124. 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

125. The agent having in customary course of business as such agent

authority either to sell goods or to consign goods for the purpose of sale
or to buy goods or to raise money on the security of goods is called

Download more at McqMate.com

 A. Agent

B. Mercantile agent

C. Partner

D. None of above

Answer: B

o m
.c
te
a
q M
c
M

Download more at McqMate.com

Take Quick Mock/Practice test on this topic HERE

For Discussion / Reporting / Correction of any MCQ please visit discussion page by clicking on
'answer' of respective MCQ.

o m
.c
te
a
q M
c
M

Download more at McqMate.com