Offer and Acceptance – MCQ on Business Law with Answers

Students should practice Offer and Acceptance – CA Foundation Business Law MCQ Questions with Answers based on the latest syllabus.

Offer and Acceptance – Business Law MCQ Questions with Answers

1. Partial acceptance of offer result in _________.
(a) counter offer
(b) unqualified acceptance
(c) binding contract
(d) none of the above
Answer:
(a) counter offer

2. A tender is _________.
(a) an offer
(b) invitation to an offer
(c) acceptance of offer
(d) none of the above
Answer:
(b) invitation to an offer

3. Death or insanity of the proposer will revoke the proposal _________.
(a) Automatically.
(b) If the fact of the death or insanity is known to the offeree.
(c) The knowledge of death or insanity is irrelevant.
(d) Only if the family members of the proposer informs the offeree.
Answer:
(b) If the fact of the death or insanity is known to the offeree.

Offer and Acceptance – MCQ on Business Law with Answers

4. When counter offer is given, the original offer _________.
(a) Lapses.
(b) Remains valid.
(c) Is accepted and becomes a contract.
(d) The original offer can also be accepted.
Answer:
(a) Lapses.

5. For an acceptance to be valid, it must be _________.
(a) Partial & qualified.
(b) Absolute & unqualified.
(c) Partial & unqualified.
(d) Absolute & qualified.
Answer:
(b) Absolute & unqualified.

6. Acceptance takes place as against the proposer, when _________.
(a) When the letter of acceptance is posted by the acceptor.
(b) When the letter of acceptance is received by the proposer.
(c) When the offeree, writes the letter of acceptance, but doesn’t post it.
(d) All the above.
Answer:
(a) When the letter of acceptance is posted by the acceptor.

7. An advertisement for sale goods by auction _________.
(a) Amounts to an invitation to offer.
(b) Amounts to an offer to hold such sale.
(c) Amounts to an implied offer.
(d) Amount to a general offer.
Answer:
(a) Amounts to an invitation to offer.

8. Communication of offer is complete when _________.
(a) It comes to the knowledge of the offeree.
(b) It is posted to the offeree.
(c) When the offeror writes the letter but does not post it.
(d) None of the above
Answer:
(a) It comes to the knowledge of the offeree.

9. An acceptance will be revoked at any time before the communication of acceptance is complete against the acceptor, but not afterwards _________.
(a) True
(b) False
(c) Acceptance once given cannot be revoked.
(d) Acceptance can be revoked at any time.
Answer:
(a) True

10. Acceptance once given cannot be revoked.
(a) True
(b) False
(c) Incomplete information.
(d) None of the above.
Answer:
(a) True

11. A tender and a bid at an auction sale are _________.
(a) Not offers.
(b) Offers.
(c) Acceptance of the offer.
(d) Invitation to offer.
Answer:
(b) Offers.

Offer and Acceptance – MCQ on Business Law with Answers

12. A quotation is:
(a) Not offer.
(b) Offer.
(c) Acceptance of the offer.
(d) Invitation to offer.
Answer:
(d) Invitation to offer.

13. If the offeree does not accept the offer according to the mode prescribed, then _________.
(a) The offeror may accept or reject such acceptance.
(b) The offer lapses automatically.
(c) It is a counter offer.
(d) Offeree commits a breach of contract.
Answer:
(a) The offeror may accept or reject such acceptance.

14. Communication of offer is complete when _________.
(a) The letter is posted to the offeree.
(b) The letter is received by the offeree.
(c) The offer is accepted by the person to whom it is made.
(d) It comes to the knowledge of the offeror that the letter has been received by the offeree.
Answer:
(b) The letter is received by the offeree.

15. A bid at an auction sale is _________.
(a) An implied offer to buy
(b) An express offer to buy
(c) An Invitation to offer to buy
(d) An invitation to come to bid
Answer:
(b) An express offer to buy

16. When the offers made by two persons to each other containing similar terms of bargain cross each other in post, they are known as _________.
(a) Cross offers
(b) Implied offers
(c) Direct offers
(d) Expressed offers
Answer:
(a) Cross offers

17. When the proposal or acceptance is made otherwise than words, the promise is said to be _________.
(a) Expressed
(b) Implied
(c) Accepted
(d) Rejected
Answer:
(b) Implied

18. The communication of an acceptance is complete as against the acceptor _________.
(a) When it is posted by him
(b) When it is put in the course of transmission
(c) When it comes to the knowledge of the proposer
(d) None of these
Answer:
(c) When it comes to the knowledge of the proposer

19. Goods displayed in a shop window with a price label will amount to _________.
(a) Offer
(b) Invitation to offer
(c) Acceptance of offer
(d) None of these
Answer:
(b) Invitation to offer

20. A promisee is _________.
(a) A person who makes a promise
(b) A person who monitors the statement of intentions of two parties
(c) A person to whom the promise is made
(d) None of these
Answer:
(c) A person to whom the promise is made

21. The person making the proposal is called _________.
(a) Promisor
(b) Promise
(c) Participator
(d) None of these
Answer:
(a) Promisor

22. Acceptance in ignorance of the offer is _________.
(a) Valid
(b) Invalid
(c) Void
(d) Voidable
Answer:
(b) Invalid

Offer and Acceptance – MCQ on Business Law with Answers

23. When the contract is perfectly valid in its substance but which cannot be enforced because of certain technical defects. This is called a _________.
(a) Unilateral contract
(b) Bilateral contract
(c) Unenforceable contract
(d) Void contract
Answer:
(c) Unenforceable contract

24. Is telegraphing lowest price on request a mere invitation for an offer?
(a) Yes
(b) No
(c) Not in normal cases
(d) None of these
Answer:
(a) Yes

25. In the case of proposal and acceptance by telephone conversation, contract is made at place where _________ is received.
(a) Offer
(b) Consideration
(c) Proposal
(d) Acceptance
Answer:
(d) Acceptance

26. An offer does not lapse if the _________.
(a) Offeror dies before acceptance
(b) The offeree dies before acceptance
(c) Acceptance is made by the offeree in ignorance of the death of the offeror
(d) Acceptance is made by the offeree with knowledge of the death of the offeror
Answer:
(c) Acceptance is made by the offeree in ignorance of the death of the offeror

27. When a person without expressing his final willingness, proposes certain terms on which he is willing to negotiate, he makes _________.
(a) Counter offer
(b) Standing offer
(c) Offer
(d) Invitation to treat
Answer:
(d) Invitation to treat

28. A subscribed to the “Daily News” for one year. After the expiry of his subscription, the newspa¬per company continued to send him the paper by mail for 3 years. A continued to use the paper but failed to pay the bills.
(a) A is not liable to pay as non-renewal of the subscription is akin to non-acceptance
(b) Non-payment of bills by A can be construed as non-acceptance of the offer made by sending the newspapers
(c) A is bound to pay as his continued use of the newspaper was an acceptance of the offer made by sending the newspaper
(d) A fresh contract is to be entered into after the lapse of the first year
Answer:
(c) A is bound to pay as his continued use of the newspaper was an acceptance of the offer made by sending the newspaper

29. Which one of the following falls into the category of offer?
(a) Newspaper advertisement regarding a sale
(b) Display of goods by a shopkeeper in his window with prices marked on them
(c) An advertisement for a concert
(d) Announcement of reward to the public
Answer:
(d) Announcement of reward to the public

30. The big Corporations like LIC supply ready forms of Contract with all conditions printed; the offeree has either to take all or let go. Such contracts are known as _________.
(a) Company contracts
(b) Corporation contracts
(c) Government
(d) Standard form contracts
Answer:
(d) Standard form contracts

Offer and Acceptance – MCQ on Business Law with Answers

31. A dress is displayed in the showroom of a shop with a price tag attached to the dress. A buyer interested in the dress and ready to pay the price mentioned in the tag approached the shopkeeper for purchasing the dress.
(a) The shopkeeper can refuse to sell the dress
(b) The shopkeeper cannot refuse to sell the dress as the buyer has accepted the offer
(c) In case of refusal, the shopkeeper will be liable for breach of contract
(d) The shopkeeper cannot refuse to sell the dress but may charge higher price
Answer:
(a) The shopkeeper can refuse to sell the dress

32. In one auction sale, ‘X’ is the highest bidder. The auctioneer accepts the offers not by speaking but by striking the hammer on the table. This amounts to
(a) Express acceptance
(b) Implied acceptance
(c) Future acceptance
(d) No acceptance
Answer:
(b) Implied acceptance

State Whether The Following Are True or False:

  1. Death or insanity of the proposer automatically revokes the proposal.
  2. Crossing of letters of offer in the post for the sale & purchase of the same article constitute a valid agreement.
  3. A proposal may be revoked by the proposer before the posting of the letter of acceptance by the acceptor.
  4. If an offer is made in the form of a promise in return for an act, the performance of that act, even without any communication thereof, is to be treated as an acceptance of the offer.
  5. Counter offer to an offer does not make the original offer lapse.
  6. Acceptance can be made even without the knowledge of the offer.
  7. A counter offer proposing different terms amount to rejection of the proposal.
  8. When the promisee does not accept the offer of performance the promisor is not responsible for non-performance.
  9. For an acceptance to be valid it should not be partial or qualified.
  10. Acceptance takes place as against the proposer, when a letter is posted, not when it is received.
  11. An advertisement for sale of goods by auction amounts to an offer to hold such sale.
  12. Communication of offer is complete when it is posted to the offeree.
  13. Performance of conditions of a proposal is an acceptance of the proposal.
  14. An acceptance will be revoked at any time before the communication of the acceptance is complete against the acceptor, but not afterwards.
  15. An offer need not be made to an ascertained person.
  16. An agreement to agree in future upon terms to be settled afterwards between the parties is valid.
  17. Acceptance once given cannot be revoked.
  18. A tender and a bid at an auction sale are not offers.
  19. A quotation and an answer to a question or inquiry are not offers.
  20. A contract is formed when the acceptor has done something to signify his intention to accept, not when he has made to his mind to do so.
  21. If the offeree does not accept the offer according to the mode prescribed by the offeror, the offer does not lapse automatically.
  22. Communication of an offer is complete when the letter is posted though it has not reached the person to whom the offer is made.
  23. Where the mode of acceptance is prescribed in the proposal, it need not be accepted in that manner.
  24. A proposal when accepted becomes a contract.
  25. Acceptance takes place when and where the message is received.

Answer:

  1. False
  2. False
  3. True
  4. True
  5. False
  6. False
  7. True
  8. True
  9. True
  10. True
  11. False
  12. False
  13. True
  14. True
  15. True
  16. False
  17. True
  18. False
  19. True
  20. True
  21. True
  22. False
  23. False
  24. False
  25. True.

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