FBLA BUSINESS LAW QUESTIONS AND ANSWERS (2026/2027)| Questions and Answers | 2026 Update | Graded +.
Acceptance ✔️The second party's unqualified willingness to go along with the first party's proposal
Accord and Satisfaction ✔️A legal way to settle contractual disputes by which one party agrees to accept less than the amount due as full
payment
Actual Authority ✔️The real power a principal gives to an agent
Actual Notice ✔️A formal notice given directly to a party, usually using certified mail with a receipt
Adhesion contract ✔️A take-it-or-leave-it offer made by a party who holds most of the power in a bargaining session
Administrative Law ✔️The body of rules created by government agencies
Agency ✔️A type of working relationship in which one person represents another person in a business transaction with a third party
Agency by Estoppel ✔️When the principal's actions lead the third party to believe that the agent is working for the principal (appointed but not
officially)
Agent ✔️The person who has been authorized to do the work
Alternative Dispute Resolution ✔️Parties try to resolve disagreements outside of the usual court system, by mediation, arbitration, conciliation,
and negotiation
Annual Percentage Rate (APR) ✔️The true interest rate of a loan
Apparent Authority ✔️Authority that a 3rd party believes an agent has while acting on behalf of the principal
Appellate Court ✔️The U.S. courts of appeals in federal system; hears appeals and reviews cases from the lower courts
Arraignment ✔️A formal hearing during which the defendant is read the indictment or info and is asked to plead guilty or not guilty
Articles of Incorporation ✔️A legal document filed with the state to establish a corporation
Arrest ✔️Occurs when a person is legally deprived of his or her freedom
Assault ✔️Attempt to commit a battery
Asset Acquisition ✔️When one corporation agrees to purchase the assests, such as property, building, and equipment, of a second corporation
Assignment ✔️The transfer of a right under contract
Assumption of Risk ✔️A defense against negligence that is raised when the plaintiff knew of the risk and still took the chance of being injured
Bail ✔️Money or other property that is left with the court to assure that a person who has been arrested, but released, will return to jail
Bailment ✔️The transfer of possession and control of personal property to another with the intent that the same property will be returned later
Bankruptcy ✔️The legal process by which a debtor can make a fresh start through the sale of assets to pay off creditors
Battery ✔️The unlawful touching of another person
Bigamy ✔️The illegal act of having two spouses at the same time
Bilateral Contract ✔️A contract that contains two promises: one party promises to do something in exchange for other's promise to do
something else
Bill of Sale ✔️Formal evidence of ownership
Breach of Contract ✔️When one party to a contract fails to perform the duties spelled out by the contract
, Burglary ✔️Breaking and entering a house or other structure to commit a felony
Capacity ✔️The legal ability to enter into a contract
Carrier ✔️A business that transports persons, goods, or both
Certificate of Incorporation ✔️A corporation's official authorization to do business in a state
Chapter 11 Bankruptcy ✔️A type of bankruptcy that allows businesses to reorganize their financial affairs and still remain in business
Chapter 12 bankruptcy ✔️A form of bankruptcy that lets family farmers and fishing businesses create a plan for debt repayment that allows
them to keep their operations running
Chapter 13 Bankruptcy ✔️A form of bankruptcy that permits individual debtors to reorganize their debts and develop payment plans
Chapter 7 Bankruptcy ✔️A type of bankruptcy that allows individual debtors to discharge all their debts and make a fresh start; ordinary
bankruptcy
Collateral ✔️The property that is offered as a security interest
Collective Bargaining ✔️A process in which union and management representatives get together to work out issues such as wages, working
conditions, and hiring and firing policies
Commerce Clause ✔️A statement in Article 1 of Constitution giving Congress power to regulate commerce among states
Common Carrier ✔️A carrier that is compensated for providing transportation to the general public
Common Law ✔️A set of laws made by the courts that provide a series of consistent rules that later courts must follow. Originated in England
Comparative Negligence ✔️A defense against negligence which is raised when the carelessness of each party is compared to the carelessness of
the other party
Compensation ✔️Fair payment for the job performed
Conglomerate ✔️A corporation that owns many different types of companies
Consideration ✔️The exchange of benefits and detriments by the parties to a contract
Consolidation ✔️When 2+ companies join together to form a new corporation
Consumer Credit Protection Act ✔️A federal law that requires creditors to inform consumers of the costs and terms of credit; Truth in Lending
Act
Contract ✔️Any agreement enforceable by law
Contributory Negligence ✔️A defense against negligence when the defendant can show the victim did something to help cause his or her own
injuries
Copyright ✔️A right granted to an author, composer, photographer, or artist to publish and sell an artistic or literary work
Corporate Director ✔️A person elected by shareholders to make broad policy decisions in the running of a corporation
Corporate Officer ✔️A person chosen by the directors to run the day-to-day affairs of a corporation
Corporation ✔️An entity with a legal authority to act as a single person distinct from its owners
Counteroffer ✔️A response to an offer in which one may receive cash, goods, or services now and pay in the future
Creditor ✔️The party who sells the goods on credit or lends the money
Crime ✔️An offense committed against the public good, or society
Cyberdefamation ✔️The communication via computer or other electronic device of false data that damages a person's reputation
Acceptance ✔️The second party's unqualified willingness to go along with the first party's proposal
Accord and Satisfaction ✔️A legal way to settle contractual disputes by which one party agrees to accept less than the amount due as full
payment
Actual Authority ✔️The real power a principal gives to an agent
Actual Notice ✔️A formal notice given directly to a party, usually using certified mail with a receipt
Adhesion contract ✔️A take-it-or-leave-it offer made by a party who holds most of the power in a bargaining session
Administrative Law ✔️The body of rules created by government agencies
Agency ✔️A type of working relationship in which one person represents another person in a business transaction with a third party
Agency by Estoppel ✔️When the principal's actions lead the third party to believe that the agent is working for the principal (appointed but not
officially)
Agent ✔️The person who has been authorized to do the work
Alternative Dispute Resolution ✔️Parties try to resolve disagreements outside of the usual court system, by mediation, arbitration, conciliation,
and negotiation
Annual Percentage Rate (APR) ✔️The true interest rate of a loan
Apparent Authority ✔️Authority that a 3rd party believes an agent has while acting on behalf of the principal
Appellate Court ✔️The U.S. courts of appeals in federal system; hears appeals and reviews cases from the lower courts
Arraignment ✔️A formal hearing during which the defendant is read the indictment or info and is asked to plead guilty or not guilty
Articles of Incorporation ✔️A legal document filed with the state to establish a corporation
Arrest ✔️Occurs when a person is legally deprived of his or her freedom
Assault ✔️Attempt to commit a battery
Asset Acquisition ✔️When one corporation agrees to purchase the assests, such as property, building, and equipment, of a second corporation
Assignment ✔️The transfer of a right under contract
Assumption of Risk ✔️A defense against negligence that is raised when the plaintiff knew of the risk and still took the chance of being injured
Bail ✔️Money or other property that is left with the court to assure that a person who has been arrested, but released, will return to jail
Bailment ✔️The transfer of possession and control of personal property to another with the intent that the same property will be returned later
Bankruptcy ✔️The legal process by which a debtor can make a fresh start through the sale of assets to pay off creditors
Battery ✔️The unlawful touching of another person
Bigamy ✔️The illegal act of having two spouses at the same time
Bilateral Contract ✔️A contract that contains two promises: one party promises to do something in exchange for other's promise to do
something else
Bill of Sale ✔️Formal evidence of ownership
Breach of Contract ✔️When one party to a contract fails to perform the duties spelled out by the contract
, Burglary ✔️Breaking and entering a house or other structure to commit a felony
Capacity ✔️The legal ability to enter into a contract
Carrier ✔️A business that transports persons, goods, or both
Certificate of Incorporation ✔️A corporation's official authorization to do business in a state
Chapter 11 Bankruptcy ✔️A type of bankruptcy that allows businesses to reorganize their financial affairs and still remain in business
Chapter 12 bankruptcy ✔️A form of bankruptcy that lets family farmers and fishing businesses create a plan for debt repayment that allows
them to keep their operations running
Chapter 13 Bankruptcy ✔️A form of bankruptcy that permits individual debtors to reorganize their debts and develop payment plans
Chapter 7 Bankruptcy ✔️A type of bankruptcy that allows individual debtors to discharge all their debts and make a fresh start; ordinary
bankruptcy
Collateral ✔️The property that is offered as a security interest
Collective Bargaining ✔️A process in which union and management representatives get together to work out issues such as wages, working
conditions, and hiring and firing policies
Commerce Clause ✔️A statement in Article 1 of Constitution giving Congress power to regulate commerce among states
Common Carrier ✔️A carrier that is compensated for providing transportation to the general public
Common Law ✔️A set of laws made by the courts that provide a series of consistent rules that later courts must follow. Originated in England
Comparative Negligence ✔️A defense against negligence which is raised when the carelessness of each party is compared to the carelessness of
the other party
Compensation ✔️Fair payment for the job performed
Conglomerate ✔️A corporation that owns many different types of companies
Consideration ✔️The exchange of benefits and detriments by the parties to a contract
Consolidation ✔️When 2+ companies join together to form a new corporation
Consumer Credit Protection Act ✔️A federal law that requires creditors to inform consumers of the costs and terms of credit; Truth in Lending
Act
Contract ✔️Any agreement enforceable by law
Contributory Negligence ✔️A defense against negligence when the defendant can show the victim did something to help cause his or her own
injuries
Copyright ✔️A right granted to an author, composer, photographer, or artist to publish and sell an artistic or literary work
Corporate Director ✔️A person elected by shareholders to make broad policy decisions in the running of a corporation
Corporate Officer ✔️A person chosen by the directors to run the day-to-day affairs of a corporation
Corporation ✔️An entity with a legal authority to act as a single person distinct from its owners
Counteroffer ✔️A response to an offer in which one may receive cash, goods, or services now and pay in the future
Creditor ✔️The party who sells the goods on credit or lends the money
Crime ✔️An offense committed against the public good, or society
Cyberdefamation ✔️The communication via computer or other electronic device of false data that damages a person's reputation
