The Introductory Business Law CLEP is the equivalent of a one-semester undergraduate business law course. It asks how American law applies to business: how a contract gets formed and broken, when a company is liable for harm it causes, how government regulates business, and how a dispute moves through the courts. It is NOT just a vocabulary test. About 30% of the exam hands you a set of facts, a buyer and a seller or an employer and a worker, and asks which rule applies and who wins. College Board splits the exam into 6 content areas, and Contracts alone is 30% to 40% of the test. The general breakdown is below.
| Category | Share of exam | What is in it |
|---|---|---|
| Contracts | 30% to 40% | Formation (offer, acceptance, consideration), capacity, joint obligations, third-party beneficiaries, assignment and delegation, statute of frauds, breach, discharge, illegal contracts, defenses to formation (fraud, duress, mistake, undue influence) |
| Legal Environment of Business | 20% to 25% | Ethics, corporate social responsibility, government regulation, administrative agencies, environmental law, securities and antitrust law, employment law, creditors' rights, international business law |
| Torts | 10% to 15% | Intentional torts, negligence (duty, breach, causation, damages), liability without fault, defenses to tort liability |
| History and Sources of American Law / Constitutional Law | 5% to 10% | Common law, statutory law, constitutional basis for business regulation, commerce clause, due process, equal protection |
| American Legal Systems and Procedures | 5% to 10% | Court structure and jurisdiction, civil vs. criminal procedure, alternative dispute resolution, trial process |
| Miscellaneous | 5% to 10% | Agency relationships, partnerships, corporations, sole proprietorships, sales and commercial transactions, property basics |
| Questions | 100 multiple choice |
| Time | 90 minutes |
| Case scenarios | About 30% of the questions |
| Passing score | 50 (some schools require 60) |
| College credits | 3 semester hours (typical) |
| Exam fee | $97 |
| Retake wait after a fail | 90 days |
How do our free questions compare to the real exam?
Every content area gets at least one question, but the mix is lopsided, and you should know which way before you read anything into your score. Here is the count for our 20 free questions (10 here, 10 more by email) against the real weights. On a 100-question exam, the percentages are also the number of questions.
| Category | Share of real exam | Our 20 free questions |
|---|---|---|
| Contracts | 30% to 40% | 11 of 20 |
| Legal Environment of Business | 20% to 25% | 2 of 20 |
| Torts | 10% to 15% | 2 of 20 |
| History and Sources of American Law / Constitutional Law | 5% to 10% | 1 of 20 |
| American Legal Systems and Procedures | 5% to 10% | 2 of 20 |
| Miscellaneous | 5% to 10% | 2 of 20 |
TIP: Our free questions lean hard on Contracts. It is 11 of our 20, which is 55%, and only 30% to 40% of the real exam. The Legal Environment of Business goes the other way. It is 20 to 25 of the 100 real questions and gets 2 of ours, one on antitrust and one on harassment at work. That leaves nothing on ethics, government regulation, administrative agencies, securities, environmental law, or creditors' rights. Our one History question is about precedent, so there is nothing on constitutional law either: no commerce clause, no due process, no equal protection. And neither of our tort questions makes you work through negligence. The good news is the format. 5 of our 20 are full case scenarios, close to the real exam's 30%. A good score here tells you your contract vocabulary is in decent shape. It does not tell you whether you are ready for the Legal Environment questions.
Where should I spend my time studying?
Five things, based on the College Board weights and what we tell every student on our study guide page:
- Start with Contracts. It is 30% to 40% of the exam, or 30 to 40 of the 100 questions, and most of the case scenarios are contract problems. Know how a contract is formed, what makes one unenforceable, what counts as a breach, and when someone outside the contract can sue on it.
- Learn the defenses to formation cold. Our study guide page calls out mistake, duress, fraud, and undue influence as the defenses that come up again and again in scenario questions. Knowing when a contract is void and when it is only voidable is one of the most tested distinctions on this exam.
- Practice the scenarios, NOT just the terms. About 30 of the 100 questions hand you a set of facts. For every rule you learn, know the two or three facts that set it off. On test day, read the last sentence of a scenario first so you know what is being asked before you read the story.
- Do not skimp on the Legal Environment of Business. It is 20% to 25% of the exam, and our free questions give you only 2 on it. Ethics, government regulation, administrative agencies, employment law, antitrust, and securities are all fair game.
- Cover what our free questions skip. Constitutional law (the commerce clause, due process, equal protection) and the elements of negligence (duty, breach, causation, damages) are both on the exam and nowhere in our free 20.
For the full topic breakdown and pass-rate history, see the Introductory Business Law CLEP study guide page.