business

Introductory Business Law

Business law, also called commercial law or mercantile law, is the body of rules which govern the dealings between persons in commercial matters. These laws establish the legal and ethical framework in which to establish and run a business.

The Introductory Business Law exam covers material that is usually taught in an introductory one-semester college course in the subject. A major emphasis of the exam tests the student’s understanding of the functions of contracts in American business law.

The student should be able to define fundamental legal terminology, identify and explain required elements of torts, contracts, etc. and understand the legal and ethical issues that arise in business decisions and the laws that apply to them.

The exam contains approximately 100 questions to be answered in 90 minutes. Some of these are pretest questions that will not be scored. The College Board provides the parameters for the exam which we have listed below.

WHAT YOU NEED TO KNOW ABOUT BUSINESS LAW:

Questions on the exam are fairly evenly divided among the topics where the student will demonstrate their abilities.

  • Knowledge of the basic facts and terms
  • Understanding of concepts and principles
  • Ability to apply knowledge to specific case problems

The subject matter of the exam is drawn from the following specific topics.

CONTRACTS: 30-40% of the exam

  • Meaning of terms
  • Formation of contracts
  • Capacity
  • Consideration
  • Joint obligations
  • Contracts for the benefit of third parties
  • Assignment/delegation
  • Statue of frauds
  • Scopes and meanings of contracts
  • Breach of contract and remedies
  • Bar to remedies for breach of contract
  • Discharge of contracts
  • Illegal contracts
  • Other

LEGAL ENVIRONMENT: 20-25% of the exam

  • Ethics
  • Social responsibility of corporations
  • Government regulation/administrative agencies
  • Antitrust law
  • Employment law
  • Product liability
  • Consumer protection
  • International business law

HISTORY and SOURCES OF AMERICAN LAW/CONSTITUTIONAL LAW: 5-10% of the exam

AMERICAN LEGAL SYSTEMS and PROCEDURES: 5-10% OF THE EXAM

TORTS: 10-15% of the exam

MISCELLANEOUS: 5-10% of the exam

  • Agency, partnerships, and corporations
  • Sales

Each college sets their own credit-granting policies for the exam, so check with your college admissions office, test center, or academic adviser before taking the test.

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