BUSINESS LAW - II (MCQS)

T.Y. B.COM

SEMESTER - IV

BUSINESS LAW - II

MCQS - JANUARY 2010

1) In Bill of Exchange a person who is directed to pay the amount of bill is called

a) Wonder

b) Payee

c) Drawee

d) Drawer

2) A Cheque is a Negotiable Instrument which is always payable on _________. 

a) Honor

b) Protest

c) Demand

d) Request

3) Promissory note contains an ...........

a) Unconditional undertaking

b) Unconditional Order

c) Conditional undertaking 

d) Conditional Order

4) Which of the following is a promissory note

a) I promise to pay B or order Rs.500/-

b) Mr. B, I owe u Rs.500/-

c) I promise to pay B Rs.200/- and all other sums which shall be due to him

d) I promise to pay B Rs.200/- seven days after my marriage with

5) If promissory notes contain an uncertain or conditional undertaking the instrument is

a) Invalid

b) Valid

c) Voidable

d) Illegal 

6) In case of bill of exchange payable other than on demand the grace period allowed is _________

a) Thirty days 

b) Fifteen days

c) Four days

d) Three days

(7) A Cheque is always drawn on

a) Specified Banker

b) Reserve Bank of India

c) Specific person

d) State Bank of India

(8) In order to have valid bill of exchange it must contain

a) an order to pay money

b) demand to pay money

c) an undertaking to pay money

d) request to pay money

9) Which one of the following is not the characteristic of a bill of exchange?

a) It must be in writing

b) It must be freely transferable

c) It must be order to pay

d) It must be payable on demand

10) A Cheque may be crossed by

a) Drawer

b) Holder

c) Banker

d) all of above

11) In which of the following Negotiable Instrument an acceptance is required

a) Bill of Exchange

b) Cheque

c) Promissory note 

d) all of above

(12) A bill drawn in favor of minor is

a) Void

b) valid but not negotiable 

c) valid 

d) None of these

(13) In legal terms, a person  who receives a negotiable instrument in good faith and for valuable consideration is known as

a) Holder precedent 

b) Holder

c) Holder in due course

d) None of these

(14) Which one of the following is not the characteristic of a negotiable instrument ? 

a) must be freely transferable

b) must be in writing

c) must contain definite amount of money

d) must be registered

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