Mercantile Law 2007 - Solved MCQs NET, IAS, State-SET (KSET, WBSET, MPSET, etc.), GATE, CUET, Olympiads etc. Set 1
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(1) Which of the following is a bilateral contract?
(a) A tells B that he will pay him ₹ 200 if B will wash his car which B does.
(b) A writes B a letter in which he promises that if B will wash his car, he will pay him ₹ 200
which B does.
(c) A and B both sign a piece of paper which says, A agrees to pay B ₹ 200 if B agrees to
wash A՚s car in exchange for ₹ 200.
(d) None of these
Answer: (a)
(2) A called his friend B and offered to give him two tickets of a cricket match taking place next
month. B said “okay! I love to watch cricket matches.” A few days later A called B and told him
that he couldn՚t give B the tickets. Assuming B sued A:
(a) He would probably win as a contract was formed.
(b) He would probably lose because the contract was not in writing.
(c) He would probably lose as the court would hold no contract was formed.
(d) None of these
Answer: (c)
(3) Under the doctrine of quasi contract, a plaintiff may recover in “quantum merit” , a Latin
phrase that means:
(a) “as much as he deserves”
(b) “treble damages”
(c) “only a token sum”
(d) None of these
Answer: ()
(4) Which of the following writings are negotiable instrument?
(a) A promise to pay ₹ 2000 for the services rendered if the services are renders as soon as
possible.
(b) An unconditional promise to pay a reasonable sum for the services rendered.
(c) An unconditional promise to pay ₹ 3000 sometime next month.
(d) None of these
Answer: (d)
(5) A has a bill of exchange that does not indicate when it is to be paid as the language of the bill only says “Pay” . When is it payable to A?
(a) In 30 days.
(b) Never as the instrument is void if it does not have a payment date.
(c) In a reasonable time.
(d) None of these
Answer: (c)
(6) A writes a cheque on his Habib Bank account to pay for groceries at Utility Stores. Who is
the drawee?
(a) Utility Stores
(b) Both Habib Bank and Utility Stores
(c) Habib Bank
(d) None of these
Answer: (c)
(7) Which of the following may count as the signature of a drawer?
(a) An “X” made by the drawer
(b) The signature of the drawer՚s agent
(c) Both of the above
(d) None of these
Answer: (c)
(8) Which of the following language on an order will create a bill of exchange?
(a) “Pay X if you can”
(b) “I wish you pay X”
(c) “Please pay X”
(d) None of these
Answer: (d)
(9) Which of the following is payable at a definite time?
(a) “Payable when” Z “wins the presidential election.”
(b) “Payable on or before May 30.”
(c) Both (a) and (b)
(d) None of these
Answer: (b)
(10) Which of the following phrases makes an order bill of exchange?
(a) “Pay to the order of A.”
(b) “Pay to the order of my brother.”
(c) Both (a) and (b)
(d) None of these
Answer: (c)