0421-215 Quiz Solved Questions & Study Guide (Summer 2026)

0421-215 Business Law Quiz 1 Solved Questions — Semester Summer 2026 (DIU BBA)

Introduction

Business Law (Course Code: 0421-215) is a core subject in the BBA program at Daffodil International University (DIU), designed to equip students with essential legal knowledge for the corporate world. This course covers foundational concepts such as contract formation, capacity to contract, offer and acceptance, and the distinctions between void and illegal agreements. For DIU BBA students, mastering these topics is crucial not only for academic success but also for navigating real-world business scenarios ethically and legally.

Practicing past Business Law quiz questions is one of the most effective ways to prepare for exams. It helps students understand the exam pattern, identify key concepts, and apply legal principles to practical situations. This solved guide for Quiz 1 (Summer 2026) provides step-by-step answers to all questions, ensuring clarity and confidence. Whether you're revising for a DIU BBA quiz or aiming to strengthen your grasp of Contract Act 1872, this resource is tailored to help you achieve better results.

Exam Overview & Mark Distribution

This Business Law Quiz 1 (0421-215, Summer 2026) consists of 4 questions, totaling 5 marks. The questions assess different Cognitive Learning Outcomes (CLOs) and difficulty levels:

• Question 1: Definitions and examples (1 mark)
• Question 2: Comparison and reasoning (1.5 marks)
• Question 3: Application of contract capacity rules (1.5 marks)
• Question 4: Analysis of acceptance rules (1 mark)

Solved Questions

### Question 1: State what is meant by:

(a) Invitation to treat, (b) Standing / open / continuing offer, (c) Counter-offer. Give one example for each.

• Invitation to Treat:

- An invitation to treat is not an offer but an invitation for others to make an offer. It is a preliminary step in negotiations.

- Example: A shop displaying a laptop in its window with a price tag is an invitation to treat. The customer makes the offer when they bring it to the counter.

- Legal Basis: Under the Contract Act 1872, an invitation to treat cannot be accepted to form a contract.

• Standing / Open / Continuing Offer:

- A standing offer is an offer that remains open for acceptance over a period, often used in business for repeated transactions.

- Example: A supplier offers to provide 100 units of a product per month at a fixed price for a year. The buyer can accept this offer for each monthly delivery.

- Key Point: Each acceptance creates a separate contract for that specific delivery.

• Counter-Offer:

- A counter-offer occurs when the offeree modifies the terms of the original offer, effectively rejecting it and proposing new terms.

- Example: If a seller offers a phone for 10,000 BDT and the buyer responds with 8,000 BDT, this is a counter-offer.

- Effect: The original offer is terminated, and the counter-offer becomes the new proposal.

Final Answer:

• (a) Invitation to treat: A preliminary step inviting offers (e.g., product display in a shop).
• (b) Standing offer: An offer open for repeated acceptance (e.g., monthly supply agreement).
• (c) Counter-offer: A modified response that rejects the original offer (e.g., bargaining a price).

### Question 2: Identify the difference between a void agreement and an illegal agreement. Why are all illegal agreements void, but not all void agreements illegal? Use practical examples.

• Void Agreement:

- A void agreement is one that is not enforceable by law from the beginning (e.g., agreements with minors or those lacking consideration).

- Example: An agreement to sell a property that does not exist is void because it lacks a valid subject matter.

- Key Point: It may be legal in nature but fails due to technicalities (e.g., lack of free consent).

• Illegal Agreement:

- An illegal agreement involves a purpose that is forbidden by law (e.g., contracts for smuggling or fraud).

- Example: An agreement to bribe a government official is illegal and unenforceable.

- Legal Basis: Under Section 23 of the Contract Act 1872, agreements with unlawful objects are void.

• Why All Illegal Agreements Are Void, But Not All Void Agreements Are Illegal:

- Illegal agreements are inherently against the law, so they are automatically void.

- Void agreements may be unenforceable for reasons other than illegality (e.g., lack of capacity, uncertainty, or impossibility).

- Example of Void but Not Illegal: An agreement with a minor is void due to lack of capacity, not because it is illegal.

Final Answer:

• Void Agreement: Unenforceable due to technical flaws (e.g., minor’s contract).
• Illegal Agreement: Unenforceable due to unlawful purpose (e.g., smuggling contract).
• All illegal agreements are void because they violate the law, but void agreements may be unenforceable for other reasons (e.g., lack of consideration).

### Question 3: Yas