SCHOOL OF ARTS, SOCIAL SCIENCES AND MANAGEMENT
DIVISION OF BUSINESS, ENTERPRISE AND MANAGEMENT
LEVEL 2 DIET 2
MODULE CODE: B2084
MODULE TITLE:Business Law
Section A
Multiple Choice Test Paper 2014
MATRICULATION NUMBER:………………………..............
DEGREE PROGRAMME:………………………………………
YEAR ……………
Instructions – please read before commencing your answers
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Please make sure you have filled out your matriculation number above.
You should attempt all questions.
Select only one answer per question.
Indicate your answer by circling in ink only the number of the choice you believe to be
correct.
Where you have indicated an answer but wish to change it, you must clearly cross out your
first choice and circle your preferred choice.
Where more than one answer is circled without crossing out, a zero mark will be given for
that question.
Question papers must not be removed from the examination hall. Removing your question
paper from the exam hall will result in an automatic zero mark.
Each question is worth 1 mark – total for Section A is 15 marks.
You must also complete 3 questions from Section B in the answer booklet provided. Each
question in Section B is worth 15 marks. Total for Section B is 45 marks.
Page 1 of 7
QUESTION 1
Which of the following is not required in all legally binding contracts?
a)
b)
c)
d)
Capacity to enter a contract
Consensus in idem
Contract to be in writing
Intention to be legally bound
QUESTION 2
Which one of the following statements is false?
a)
b)
c)
d)
Gambling contracts are enforceable by the courts
A limited company has legal capacity to enter a contract
Acceptance of a contract can be communicated by one of the parties’ actions
A legally enforceable contract can never be made via the internet
QUESTION 3
Joan advertises “Guitar for sale £100 or near offer”. Sarah emails Joan and says she will pay
her £80. Joan emails back saying she would be willing to accept £90. 24 hours later Joan has
not heard back from Sarah so she agrees to sell the guitar to Adam for £85. An hour later she
receives a message from Sarah saying she would buy the guitar for £90. Which of the following
statements are correct?
1.
2.
3.
4.
Joan has a valid contract with Sarah to sell the guitar to her for £90
Joan has a valid contract with Adam to sell the guitar to him for £85
Joan’s offer to sell the guitar to Sarah for £90 is a legal binding promise
Joan’s offer to sell the guitar to Sarah for £90 is a counteroffer
Answer
a) 1 and 4
b) 2 and 3
c) 2 and 4
d) 3 and 4
Page 2 of 7
QUESTION 4
What is the highest court that hears civil cases from Scotland?
a)
b)
c)
d)
Inner House
Supreme Court
Outer House
House of Lords
QUESTION 5
Anna is the organizer of a music event featuring Hotplay. Tickets cost £60. Unfortunately the
lead singer is unwell and she is forced to cancel the event. She offers a full refund to all those
people who have booked tickets. Serge wants to claim from Anna the cost of his non refundable
train ticket to get to the event. However Anna points to clause 1 in the terms and conditions on
the back of the ticket which states that “In the event of cancellation, liability is limited to the face
value of the ticket”
Which of the following statements is incorrect?
a) Clause 1 is a limitation clause
b) Clause 1 is a term of the contract because notice was given of it before Serge entered the
contract
c) Clause 1 is a term of the contract because it appeared on a “ticket”
d) Clause 1 is a term of the contract because such terms are commonly found in
entertainment contracts and will be incorporated by virtue of custom and practice
QUESTION 6
In relation to breach of contract which of the following sentences is correct
a) Damages can be claimed for distress or disappointment in all contracts
b) The innocent party is under a duty to mitigate their losses
c) All breaches of contract are material
d) A material breach of contract entitles the innocent party isto damages only
Page 3 of 7
QUESTION 7
A clothes shop has priced a jacket at £25. The price ticket is incorrect and should be £35. Kim
takes the jacket to the till and when the price is scanned the price comes up at £35. The shop
refuses to sell the jacket for £25 and insist that she pays £35. Which of the following statements
is correct?
1.
2.
3.
4.
The price ticket stating £25 is an offer
Kim makes an offer of £25 to buy the jacket
The shop must sell Kim the jacket for £25 as she saw the lower price ticket
The shop makes a counteroffer of £35.
Answer
a) 1 and 3
b) 2 and 4
c) 2 only
d) 3 only
QUESTION 8
Which of the following is required to establish a legal claim for fraudulent misrepresentation?
1.
2.
3.
4.
False statement of opinion
False statement of fact
Reliance on the information given
The person making the statement knows that the statement is false or is reckless when
making the statement
Answer
a) All of them
b) 1, 3 and 4
c) 2, 3 and 4
d) 2 and 3
QUESTION 9
A contract which is so fundamentally flawed that it is not binding on either party is known as
which of the following
a)
b)
c)
d)
Void contract
Voidable contract
Unenforceable contract
A breach of contract
Page 4 of 7
QUESTION 10
The name of a business can tell you its legal status. The accountancy firm of ‘Brennan, Blair and
Gill’ is:
a)
b)
c)
d)
A public limited company
A private limited company
A sole trader
A partnership
QUESTION 11
Agency: Which of the following statements are true?
1)
2)
3)
4)
An agency contract always has to be in writing
An agent must always act in good faith
An agent in emergency situations is known as a jus quaesitum tertio
An agency contract will set out the agent’s ostensible authority
QUESTION 12
You pay for you and your friend to go to the theatre. Your friend is injured due to the fact that
part of the ceiling collapses whilst they are watching the play. Which one of the following
statements is incorrect?
a)
b)
c)
d)
Your friend is a primary victim
The theatre has a duty of care to your friend
The principle of res ipsa loquitur probably applies
Your friend can sue the theatre in contract law
QUESTION 13
In Sayers v Harlow Urban District Council a woman found herself trapped inside a toilet cubicle
that had no door handle. Which of the following statements are true relating to this case?
1) The Council was not held liable.
2) The Council was held vicariously liable
3) The plaintiff succeeded in her claim using res ipsa loquitur
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4) The plaintiff’s damages award was reduced due to contributory negligence
ANSWER:
a) 1 and 3
b) 2 and 4
c) 1 only
d) 4 only
QUESTION 14
If I am a primary victim of negligence suffering psychiatric injury, what do I need to prove?
1. A duty of care was owed, the duty was breached, and my loss resulted from the breach
2. Close ties of love and affection, proximity in space and time, and direct exposure to the
incident
3. Vicarious liability of the defender
4. Clinical negligence
ANSWER:
a) 2 and 4
b) 3 and 1
c) 1 only
d) 2 only
QUESTION 15
In Kay’s Tutor v Ayrshire & Arran Health Board a baby admitted with meningitis was
incorrectly given penicillin. The case failed for which of the following reasons?
1.
2.
3.
4.
The hospital did not owe the baby a duty of care
The hospital did not breach its duty of care to the baby
The hospital was not vicariously liable for the negligent actions of the staff
The hospital’s breach of its duty did not cause the babies’ injuries
ANSWER:
a)
b)
c)
d)
1 only
2 and 4
3 only
4 only
Page 6 of 7
QUESTION
SPARE IF WANT TO SWAP ANY
Which one of the following statements is true?
a)
b)
c)
d)
The courts do not allow claims for psychiatric injury
Liability in contract is strict whilst liability in the law of negligence is based on fault
Vicarious liability means that an employer is liable for all acts of their employees
Causation is not relevant in deciding whether a party is liable in negligence
END OF SECTION A
YOU MUST ALSO COMPLETE THREE QUESTIONS IN SECTION B
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