BUSINESS LAW 150 QUESTIONS AND
ANSWERS
Note: Correct answers are colored;
1. The law will presume the parties intend to be bound by a contract when it arises
out of:
a. A social situation
b. A domestic situation
c. A commercial situation
d. All of these
2. An advertisement is considered to be:
a. An offer
b. An invitation to treat
c. A contract
d. A statement of fact
3. An offer cannot be terminated by:
a. A third party
b. Declining the offer
c. A lapse of the offer after a reasonable period of time
d. A counter offer
4. A lapsed offer is:
a. An offer that has terminated after a period of time
, b. An offer that has been extended
c. An offer that requires signatures from both parties
d. None of these
5. The basic requirements to create a contract include:
a. Clarity
b. It must be in writing
c. Intention
d. All of these
6. An implied term:
a. Is presumed from the circumstances
b. Is expressed directly in the contract
c. Is outlined in the preamble
d. Is always present in a contract
7. A gratuitous promise involves:
a. No expectation of a benefit in return
b. A one-sided exchange
c. The inability to legally enforce the promise
d. All of these
8. James says he would like to buy Mike's motorbike for $3,000. Mike responds by saying
he would accept $4,000 given all the work he has put into it. James says "Ok. I'll give
that. Here's $2,000 now, and I'll pay the balance in two instalments."
a. This is a contract
b. This is not a contract
ANSWERS
Note: Correct answers are colored;
1. The law will presume the parties intend to be bound by a contract when it arises
out of:
a. A social situation
b. A domestic situation
c. A commercial situation
d. All of these
2. An advertisement is considered to be:
a. An offer
b. An invitation to treat
c. A contract
d. A statement of fact
3. An offer cannot be terminated by:
a. A third party
b. Declining the offer
c. A lapse of the offer after a reasonable period of time
d. A counter offer
4. A lapsed offer is:
a. An offer that has terminated after a period of time
, b. An offer that has been extended
c. An offer that requires signatures from both parties
d. None of these
5. The basic requirements to create a contract include:
a. Clarity
b. It must be in writing
c. Intention
d. All of these
6. An implied term:
a. Is presumed from the circumstances
b. Is expressed directly in the contract
c. Is outlined in the preamble
d. Is always present in a contract
7. A gratuitous promise involves:
a. No expectation of a benefit in return
b. A one-sided exchange
c. The inability to legally enforce the promise
d. All of these
8. James says he would like to buy Mike's motorbike for $3,000. Mike responds by saying
he would accept $4,000 given all the work he has put into it. James says "Ok. I'll give
that. Here's $2,000 now, and I'll pay the balance in two instalments."
a. This is a contract
b. This is not a contract
