Mercantile Law 2001-Solved MCQs Competitive Exams Set 1

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(1) A proposes, by a letter sent by post, to sell his house to B. The acceptance of the proposal is


Answer: the moment the letter is received by B.

(2) In order to convert a proposal into a promise, the acceptance must be:

Answer: Unconditional

(3) A voidable contract may be turned by the option of the party at a loss into:

Answer: A valid contract

(4) The maximum number of members in a private company is:

Answer: 50

(5) The maximum number of partners in a firm is:

Answer: None of these

(6) The Companies Ordinance, 1984:

Answer: None of these

(7) A Company is subsidiary of another Company:

Answer: If the other company holds more than 50 % of its voting shares

(8) P appoints A as his agent. A is not a person of full age:

Answer: The appointment of A is valid

(9) Statutory meeting of a Company is held:

Answer: Once in a life time of the Company

(10) Publication of Prospectus is compulsory by:

Answer: A Private Company

(11) Award is a decision given by:

Answer: An arbitrator

(12) A lends some ornaments to B to be used in a marriage. The transaction is:

Answer: A bailment

(13) A partner may be expelled from a partnership by:

Answer: A majority of partners

(14) Third Party Insurance is an Insurance Relating to:

Answer: None of these

(15) A Bill of Exchange has:

Answer: Three parties

(16) A minor:

Answer: Can make, draw, accept, or indorse a negotiable instrument

(17) A void as well as an illegal contract is:

Answer: Not familiar in effect

(18) In the Companies Ordinance, 1984, there are:

Answer: Kinds of shares

(19) Like a cheque, a bill of exchange may be:

Answer: Cannot be crossed

( “Like” should not be used rather “unlike” )

(20) An executor consideration takes the form of:

Answer: A promise to be performed in future