ICAN CAP-I — Mercantile Law & Fundamentals of Economics: Extended Solutions & Highlights | CAP-I Exam Prep: Contracts, Nemo Dat, NI Methods & Markets — Long Q&A + Hashtags

CAP-I Mega Q&A: Mercantile Law & Fundamentals of Economics (Extra-Long Answers, SEO-Ready)

Exam-focused, mobile friendly, dark-mode aware. Each answer highlights core definitions, rules, and exam-style reasoning. Use the Summary Task after each question to make students write their own recap for better retention.

Paper 2A — Mercantile Law (Advanced Add-Ons)

Q1) Doctrine of Caveat Emptor: meaning, key exceptions, and quick case logic

Answer: Caveat Emptor means “let the buyer beware.” The buyer carries the responsibility to examine quality/fitness; if the product underperforms, the seller is generally not liable. However, important exceptions protect buyers: (i) misrepresentation or fraud by the seller, (ii) concealed defects, (iii) sale by sample/description where delivered goods don’t correspond, (iv) lack of merchantable quality, and (v) where the buyer discloses the particular purpose, relies on the seller’s skill/judgment, and the seller supplies such goods. :contentReference[oaicite:0]{index=0} In the classic exam twist—if a buyer didn’t state the specific purpose (e.g., ripe mangoes for ice-cream tomorrow), the seller may not be at fault and Caveat Emptor applies. :contentReference[oaicite:1]{index=1}

#CAP_I #MercantileLaw #SaleOfGoods #CaveatEmptor #ConsumerProtection #ExamPrep

Q2) Quasi / Indirect Contracts: meaning, basis, and leading examples

Answer: A quasi (indirect) contract is not formed by offer/acceptance—law imposes obligations to prevent unjust enrichment. Nepalese Contract Act provisions describe situations like reimbursement when one pays another’s legal liability, reasonable remuneration for non-gratuitous services, refund of money paid by mistake, and bailment-like duties when holding another’s property. :contentReference[oaicite:2]{index=2} Recent suggested answers further list types: acts to protect property during disaster, expenses of nurture/treatment, public body expenses, stakeholder reimbursements, and more—these all flow from equity to avoid unfair gain. :contentReference[oaicite:3]{index=3}:contentReference[oaicite:4]{index=4}

#QuasiContract #UnjustEnrichment #NepalContractAct #CAP_I #MercantileLaw #LegalTheory

Q3) Agency — creation (agreement, estoppel, holding out, necessity) & ratification

Answer: Agency is typically created by express or implied agreement. It can also arise via estoppel or holding out where a principal’s conduct leads third parties to believe authority exists, and by necessity where urgent circumstances justify acting on another’s behalf. Unauthorized acts later approved by the principal become binding through ratification. :contentReference[oaicite:5]{index=5}:contentReference[oaicite:6]{index=6}

#AgencyLaw #Estoppel #HoldingOut #Ratification #Contract #CAP_I #MercantileLaw

Q4) Termination of Agency by operation of law — Nepal Civil (Code) highlights

Answer: Without any breach, agency ends when the work completes or the fixed period expires; it also terminates upon death/insanity of parties, insolvency of the principal, destruction of the subject matter, company liquidation, or removal of the main agent (ending sub-agency). :contentReference[oaicite:7]{index=7} These mirrors in prior suggested solutions as statutory points students should cite. :contentReference[oaicite:8]{index=8}

#AgencyTermination #CivilCode2074 #Contract #CAP_I #MercantileLaw #NepalLaw

Q5) Sale vs. Agreement to Sell — risk, title, insolvency, and remedies

Answer: In a Sale, property (ownership) passes immediately; in an Agreement to Sell, transfer is future/conditional. This changes risk, right to re-sell, remedies (price vs. damages), and insolvency consequences for both buyer and seller. :contentReference[oaicite:9]{index=9}:contentReference[oaicite:10]{index=10}

#SaleOfGoods #AgreementToSell #RiskTitle #Insolvency #Remedies #CAP_I #MercantileLaw

Paper 2B — Fundamentals of Economics (More Long Answers)

Q6) Law of Supply with curve logic and exam articulation

Answer: Holding other factors constant, price and quantity supplied move together: higher price → larger quantity supplied; lower price → smaller quantity supplied, often denoted S = f(P). The upward-sloping supply curve depicts this relation and can be illustrated via a hypothetical schedule (plotting price–quantity pairs). :contentReference[oaicite:11]{index=11}:contentReference[oaicite:12]{index=12}

#Economics #LawOfSupply #Microeconomics #SupplyCurve #CAP_I #ExamNotes

Q7) Monopolistic Competition — short-run price–output, three cases (AR vs AC)

Answer: Monopolistic competition blends monopoly and perfect competition: many firms, differentiated products, and free entry/exit. In the short run, equilibrium where MR = MC can yield abnormal profit (AR > AC), normal profit (AR = AC), or loss (AR < AC)—the position of the AC curve at the tangency/equality dictates which. :contentReference[oaicite:13]{index=13}:contentReference[oaicite:14]{index=14}

#MonopolisticCompetition #AR_MR_AC #ShortRun #MarketStructure #CAP_I #Economics

Q8) Returns to Scale — IRS vs CRS (definition + diagram talk)

Answer: With all inputs variable (long run), increasing returns to scale (IRS) means output rises more than proportionally to inputs; constant returns to scale (CRS) means output rises in the same proportion as inputs. Suggested answers show numeric/diagrammatic builds to justify each case and typical causes like specialization and indivisibilities. :contentReference[oaicite:15]{index=15}:contentReference[oaicite:16]{index=16}

#ReturnsToScale #IRS #CRS #Production #Microeconomics #CAP_I #Economics

Q9) Perfect Competition — core features you must list fast

Answer: A theoretical benchmark where many buyers/sellers trade a homogeneous product, with perfect knowledge, no single agent can affect price (firms are price-takers; industry sets price), and—under assumptions—no government intervention. In practice it’s rare but analytically useful for price/output determination. :contentReference[oaicite:17]{index=17}:contentReference[oaicite:18]{index=18}

#PerfectCompetition #PriceTaker #MicroFoundations #MarketFeatures #CAP_I #Economics

Q10) International Trade — key reasons it arises (exam list)

Answer: Trade emerges due to differences in technology, resource endowments, and consumer demand; plus economies of scale, government policies (taxes/subsidies), and currency differences—explaining specialization, comparative advantage, and development linkages. :contentReference[oaicite:19]{index=19}

#InternationalTrade #ComparativeAdvantage #EconomiesOfScale #Policy #CAP_I #Economics

Q11) TR–AR–MR under Monopoly — the relationship you should narrate

Answer: With a downward-sloping demand (AR), MR lies below AR. As quantity rises, TR increases at a diminishing rate, hits a maximum, and then falls; AR and MR are both downward sloping with AR > MR at every positive output. :contentReference[oaicite:20]{index=20}

#Monopoly #TotalRevenue #AverageRevenue #MarginalRevenue #CAP_I #Economics

Q12) Usefulness of Microeconomics — optimization, prediction, pricing

Answer: Firms use microeconomic tools for optimization (output/profit max; cost min), picking least-cost techniques (e.g., linear programming) and forecasting using cause–effect relationships—vital for pricing (product and factor prices) via demand–supply and elasticity ideas. :contentReference[oaicite:21]{index=21}:contentReference[oaicite:22]{index=22}

#Microeconomics #Optimization #Forecasting #Pricing #Elasticity #CAP_I

Bonus Mix (from other CAP-I papers) — Optional Adds

Q13) Annuity Present Value (Commercial Math) — cash price with down-payment & installments

Answer: Cash price = down-payment + PV of annuity. For annual installment P, rate i, and n years: PV = P/i · [1 − (1+i)⁻ⁿ]. Plug values from the prompt to compute and add the down-payment to get the cash price. :contentReference[oaicite:23]{index=23}

#CommercialMathematics #Annuity #PresentValue #TimeValueOfMoney #CAP_I

Q14) Partnership — rights/duties quick map (Nepalese provisions)

Answer: Typical rights include: participate in business, access books, share profits, interest on capital/advances, indemnity, and retirement; duties include: act for common benefit, good faith, furnish true accounts, full information, indemnify for fraud, no secret profit or assignment without consent, share losses, etc. :contentReference[oaicite:24]{index=24}:contentReference[oaicite:25]{index=25}

#Partnership #RightsAndDuties #BusinessLaw #CAP_I #MercantileLaw

Q15) Common Carrier — meaning, duties, and a contrast with private carriers

Answer: A common carrier regularly transports goods for the public along customary routes without discrimination and for reward; core duties include carry indiscriminately, deliver on time/place, and safe carriage. :contentReference[oaicite:26]{index=26}:contentReference[oaicite:27]{index=27} Compared to private carriers, common carriers cannot refuse eligible goods and their rights/liabilities are governed by carriage law (vs contract for private). :contentReference[oaicite:28]{index=28}

#CommonCarrier #Carriage #LogisticsLaw #CAP_I #MercantileLaw

Student Summary Task: For each question, write a 3–5 sentence summary in your own words. Include (i) the core definition/rule, (ii) 1–2 highlighted terms (use <mark>), and (iii) one real/imagined exam scenario where you’d apply it.

Tip: Keep a running revision sheet where you convert each long answer above into bullet points, then rehearse aloud. Need more Q&A on specific sub-topics? Request a focused pack.