Question 1

How can a buyer waive warranty rights?

Accepted Answer

A) By failing to examine goods for which an express warranty was created by a sample or model. 
B) By failing to comply with the seller's request to inspect the goods. 
C) By failing to examine goods for which an express warranty was created by a sample or model,or by failing to comply with the seller's request to inspect the goods. 
D) By failing to require that warranties be given in writing,or by failing to comply with the seller's request to inspect the goods. 
E) Pursuant to a Uniform Commercial Code mandate advancing the public policy interests of consumer protection,a buyer cannot waive rights associated with implied and express warranties. 
A) By failing to examine goods for which an express warranty was created by a sample or model. 
B) By failing to comply with the seller's request to inspect the goods. 
C) By failing to examine goods for which an express warranty was created by a sample or model,or by failing to comply with the seller's request to inspect the goods. 
D) By failing to require that warranties be given in writing,or by failing to comply with the seller's request to inspect the goods. 
E) Pursuant to a Uniform Commercial Code mandate advancing the public policy interests of consumer protection,a buyer cannot waive rights associated with implied and express warranties.

Question 2

Under the Magnuson-Moss Act,what is the effect of a full warranty?

Accepted Answer

A) It means that if the good fails or is defective,the good or its defective part will be replaced; and that if replacement cannot be timely effected,the buyer has the right to a refund or a full replacement. 
B) It means only that the good or its defective part will be repaired.The buyer has no other remedy. 
C) It means that if the good fails or is defective,the good or its defective part will be replaced; that if replacement cannot be timely effected,the buyer has the right to a refund or a full replacement; and that the buyer will receive additional funds to account for expenses incurred in seeking warranty recognition and enforcement. 
D) It means that the seller must immediately refund the buyer the full purchase price. 
E) It means that the buyer has the option of either an immediate refund of the full purchase price or repair of the good. 
A) It means that if the good fails or is defective,the good or its defective part will be replaced; and that if replacement cannot be timely effected,the buyer has the right to a refund or a full replacement. 
B) It means only that the good or its defective part will be repaired.The buyer has no other remedy. 
C) It means that if the good fails or is defective,the good or its defective part will be replaced; that if replacement cannot be timely effected,the buyer has the right to a refund or a full replacement; and that the buyer will receive additional funds to account for expenses incurred in seeking warranty recognition and enforcement. 
D) It means that the seller must immediately refund the buyer the full purchase price. 
E) It means that the buyer has the option of either an immediate refund of the full purchase price or repair of the good.

Question 3

The perfect tender rule requires that the seller deliver goods in conformity with the terms of the contract.

Accepted Answer

A) True 
 B)False

Question 4

List the eight options discussed in the text that may be available to a buyer/lessee when the seller/lessor is in breach.

Accepted Answer

When the seller/lessor is in breach,the

Question 5

What law does the judicial system rely on to clarify the obligations of a seller and a buyer if their agreement is unclear?

Accepted Answer

A) The United States Constitution 
B) Common law 
C) The Restatement of Contracts 
D) The Uniform Commercial Code 
E) Local and municipal ordinances 
A) The United States Constitution 
B) Common law 
C) The Restatement of Contracts 
D) The Uniform Commercial Code 
E) Local and municipal ordinances

Question 6

Which of the following must a buyer do in obtaining cover?

Accepted Answer

A) Demonstrate good faith in obtaining the substitute goods,and pay a reasonable amount for the substitute goods 
B) Pay a reasonable amount for the substitute goods,and act without unreasonable delay in purchasing the substitute goods 
C) Act without unreasonable delay in purchasing the substitute goods,and purchase goods that are reasonable substitutes 
D) Pay a reasonable amount for the substitute goods,act without unreasonable delay in purchasing the substitute goods,and purchase goods that are reasonable substitutes 
E) Demonstrate good faith in obtaining the substitute goods,pay a reasonable amount for the substitute goods,act without unreasonable delay in purchasing the substitute goods,and purchase goods that are reasonable substitutes. 
A) Demonstrate good faith in obtaining the substitute goods,and pay a reasonable amount for the substitute goods 
B) Pay a reasonable amount for the substitute goods,and act without unreasonable delay in purchasing the substitute goods 
C) Act without unreasonable delay in purchasing the substitute goods,and purchase goods that are reasonable substitutes 
D) Pay a reasonable amount for the substitute goods,act without unreasonable delay in purchasing the substitute goods,and purchase goods that are reasonable substitutes 
E) Demonstrate good faith in obtaining the substitute goods,pay a reasonable amount for the substitute goods,act without unreasonable delay in purchasing the substitute goods,and purchase goods that are reasonable substitutes.

Question 7

Hot Toaster.Rebecca bought a toaster from Super Store and brought it home.A friend of hers,Greg,was at her house making toast.The toaster malfunctioned and shocked Greg,resulting in a small burn to his hand requiring medical attention.At a garage sale,Rebecca also purchased a blender from a friend,Samantha.When she paid for the blender,Rebecca said that it would be great for making smoothies.Samantha said nothing and just smiled while taking Rebecca's money.Unfortunately,the blender was not powerful enough to make smoothies.Which of the following is true regarding whether Samantha made an express warranty to Rebecca that the blender would make smoothies?

Accepted Answer

A) Samantha made an express warranty by not speaking up regarding the performance limitations of the blender. 
B) Samantha made an express warranty by not speaking up regarding the performance limitations of the blender,but only if Rebecca can prove that Samantha knew about the problems. 
C) Samantha made an express warranty by not speaking up regarding the performance limitations of the blender,but only if Rebecca cannot prove that Samantha knew about the problems. 
D) Samantha made an express warranty by not speaking up regarding the performance limitations of the blender,but only if Samantha can prove that she did not know about the problems. 
E) Samantha did not make an express warranty. 
A) Samantha made an express warranty by not speaking up regarding the performance limitations of the blender. 
B) Samantha made an express warranty by not speaking up regarding the performance limitations of the blender,but only if Rebecca can prove that Samantha knew about the problems. 
C) Samantha made an express warranty by not speaking up regarding the performance limitations of the blender,but only if Rebecca cannot prove that Samantha knew about the problems. 
D) Samantha made an express warranty by not speaking up regarding the performance limitations of the blender,but only if Samantha can prove that she did not know about the problems. 
E) Samantha did not make an express warranty.

Question 8

The Uniform Commercial Code requires lessors to ________ goods to lessees.

Accepted Answer

A) tender materially conforming 
B) proffer substantially conforming 
C) tender conforming 
D) factor in equity 
E) proffer in equity 
A) tender materially conforming 
B) proffer substantially conforming 
C) tender conforming 
D) factor in equity 
E) proffer in equity

Question 9

Under the Uniform Commercial Code,a buyer must bring a lawsuit on a breached contract within ________ of when the breach occurred or when the buyer became aware of it.

Accepted Answer

A) 180 days 
B) one year 
C) three years 
D) four years 
E) six years 
A) 180 days 
B) one year 
C) three years 
D) four years 
E) six years

Question 10

The perfect tender rule is established by local,municipal,and/or state ordinance.

Accepted Answer

A) True 
 B)False

Question 11

According to the Uniform Commercial Code,a buyer may always revoke acceptance of nonconforming goods.

Accepted Answer

A) True 
 B)False

Question 12

If goods are identified at the time the parties entered into a contract and these goods are destroyed through no fault of the parties before risk passes to the buyer,which of the following is true?

Accepted Answer

A) The parties are excused from performance. 
B) The seller has 7 days within which to cure. 
C) The seller has 10 days within which to cure. 
D) The seller has 30 days within which to cure. 
E) The seller has 60 days within which to cure. 
A) The parties are excused from performance. 
B) The seller has 7 days within which to cure. 
C) The seller has 10 days within which to cure. 
D) The seller has 30 days within which to cure. 
E) The seller has 60 days within which to cure.

Question 13

Hot Toaster.Rebecca bought a toaster from Super Store and brought it home.A friend of hers,Greg,was at her house making toast.The toaster malfunctioned and shocked Greg,resulting in a small burn to his hand requiring medical attention.At a garage sale,Rebecca also purchased a blender from a friend,Samantha.When she paid for the blender,Rebecca said that it would be great for making smoothies.Samantha said nothing and just smiled while taking Rebecca's money.Unfortunately,the blender was not powerful enough to make smoothies.Which of the following rights,if any,does Greg have against Super Store in most states?

Accepted Answer

A) None,because he did not buy the toaster. 
B) None,because he is not married to Rebecca. 
C) None,because he is not married or otherwise related to Rebecca. 
D) He may sue,but only if Rebecca joins him as a co-plaintiff in the lawsuit. 
E) He may sue Super Store for his injuries. 
A) None,because he did not buy the toaster. 
B) None,because he is not married to Rebecca. 
C) None,because he is not married or otherwise related to Rebecca. 
D) He may sue,but only if Rebecca joins him as a co-plaintiff in the lawsuit. 
E) He may sue Super Store for his injuries.

Question 14

According to the Magnuson-Moss Act,if a written warranty is silent regarding whether it is a full or limited warranty,it is presumed to be a limited warranty.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following is true regarding a buyer's acceptance of goods?

Accepted Answer

A) Goods may be accepted in total even if they are nonconforming. 
B) The seller may presume acceptance if the buyer fails to reject goods within a reasonable period of time. 
C) The buyer may make a partial acceptance of nonconforming goods when the seller has failed to cure defects. 
D) Goods may be accepted in total even if they are nonconforming,the seller may presume acceptance if the buyer fails to reject goods within a reasonable period of time,and the buyer may make a partial acceptance of nonconforming goods when the seller has failed to cure defects. 
E) Goods may be accepted in total even if they nonconforming,and the seller may presume acceptance if the buyer fails to reject goods within a reasonable period of time; however,the buyer may not make a partial acceptance of nonconforming goods when the seller has failed to cure defects. 
A) Goods may be accepted in total even if they are nonconforming. 
B) The seller may presume acceptance if the buyer fails to reject goods within a reasonable period of time. 
C) The buyer may make a partial acceptance of nonconforming goods when the seller has failed to cure defects. 
D) Goods may be accepted in total even if they are nonconforming,the seller may presume acceptance if the buyer fails to reject goods within a reasonable period of time,and the buyer may make a partial acceptance of nonconforming goods when the seller has failed to cure defects. 
E) Goods may be accepted in total even if they nonconforming,and the seller may presume acceptance if the buyer fails to reject goods within a reasonable period of time; however,the buyer may not make a partial acceptance of nonconforming goods when the seller has failed to cure defects.

Question 16

According to the Uniform Commercial Code,in order for a buyer to properly "cover," he or she need not demonstrate good faith in obtaining the substitute goods because the seller initially breached the contract.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is an accurate statement regarding common law and express warranties?

Accepted Answer

A) Although the common law does not use the term express warranty,the concept and its application do exist in the common law. 
B) The common law specifically incorporates and defines the term express warranty 
C) To use common law language,an express warranty is a non-material term of the sale or lease contract. 
D) To use common law language,an express warranty is an equitable requirement of any sale or lease contract. 
E) To use common law language,an express warranty must be incorporated in a written sale or lease contract in order to be enforceable. 
A) Although the common law does not use the term express warranty,the concept and its application do exist in the common law. 
B) The common law specifically incorporates and defines the term express warranty 
C) To use common law language,an express warranty is a non-material term of the sale or lease contract. 
D) To use common law language,an express warranty is an equitable requirement of any sale or lease contract. 
E) To use common law language,an express warranty must be incorporated in a written sale or lease contract in order to be enforceable.

Question 18

With regard to implied warranties,implied means that the warranty or guarantee is automatically part of the contract.

Accepted Answer

A) True 
 B)False

Question 19

Boat Tow.Donnie went to a new car dealership and told the salesperson (who was not the manager)that he needed a new car that would both get good gas mileage and pull his big boat.The salesperson encouraged him to buy a smaller car that the salesperson promised would pull the boat.Donnie bought the car and used it to pull the boat.Unfortunately,the heavy pull on the car did significant damage to the car's engine.Donnie complained to the salesperson,who denied any liability.Donnie,who had taken half-a-semester of business law,informed the salesperson that along with the sale of the car he also received an express warranty and an implied warranty of merchantability,and that he could recover under either of those theories.Will Donnie likely be able to recover damages based upon a breach of the implied warranty of merchantability?

Accepted Answer

A) No,because the implied warranty of merchantability guaranteed that the car would be fit for the ordinary purposes for which it is used.Pulling a boat is not an ordinary purpose for a small car. 
B) Yes,because Donnie informed the salesperson about the need for the car to pull the boat. 
C) Yes,because the salesperson told Donnie that the car would pull the boat. 
D) No,because of the lack of an implied warranty of fitness for a particular purpose. 
E) No,because there was no warranty of merchantability. 
A) No,because the implied warranty of merchantability guaranteed that the car would be fit for the ordinary purposes for which it is used.Pulling a boat is not an ordinary purpose for a small car. 
B) Yes,because Donnie informed the salesperson about the need for the car to pull the boat. 
C) Yes,because the salesperson told Donnie that the car would pull the boat. 
D) No,because of the lack of an implied warranty of fitness for a particular purpose. 
E) No,because there was no warranty of merchantability.

Question 20

When does the Uniform Commercial Code allow buyers to seek the remedy of specific performance?

Accepted Answer

A) Only when the goods are unique 
B) Only when a remedy at law is inadequate 
C) Only when the goods are worth more than $500 
D) When the goods are unique,when a remedy at law is inadequate,or when the goods are worth more than $500 
E) When the goods are unique or when a remedy at law is inadequate,but not because the goods are worth more than $500 
A) Only when the goods are unique 
B) Only when a remedy at law is inadequate 
C) Only when the goods are worth more than $500 
D) When the goods are unique,when a remedy at law is inadequate,or when the goods are worth more than $500 
E) When the goods are unique or when a remedy at law is inadequate,but not because the goods are worth more than $500

Exam 16: Sales and Lease Contracts: Performance, Warranties, and Remedies

How can a buyer waive warranty rights?

Under the Magnuson-Moss Act,what is the effect of a full warranty?

The perfect tender rule requires that the seller deliver goods in conformity with the terms of the contract.

List the eight options discussed in the text that may be available to a buyer/lessee when the seller/lessor is in breach.

What law does the judicial system rely on to clarify the obligations of a seller and a buyer if their agreement is unclear?

Which of the following must a buyer do in obtaining cover?

The Uniform Commercial Code requires lessors to ________ goods to lessees.

Under the Uniform Commercial Code,a buyer must bring a lawsuit on a breached contract within ________ of when the breach occurred or when the buyer became aware of it.

The perfect tender rule is established by local,municipal,and/or state ordinance.

According to the Uniform Commercial Code,a buyer may always revoke acceptance of nonconforming goods.

If goods are identified at the time the parties entered into a contract and these goods are destroyed through no fault of the parties before risk passes to the buyer,which of the following is true?

According to the Magnuson-Moss Act,if a written warranty is silent regarding whether it is a full or limited warranty,it is presumed to be a limited warranty.

Which of the following is true regarding a buyer's acceptance of goods?

According to the Uniform Commercial Code,in order for a buyer to properly "cover," he or she need not demonstrate good faith in obtaining the substitute goods because the seller initially breached the contract.

Which of the following is an accurate statement regarding common law and express warranties?

With regard to implied warranties,implied means that the warranty or guarantee is automatically part of the contract.

When does the Uniform Commercial Code allow buyers to seek the remedy of specific performance?

An Introduction to the Fundamentals of Dynamic Business Law

Business Ethics and Social Responsibility

The Uslegal System and Alternative Dispute Resolution

Administrative Law

Constitutional Law

Criminal Law and Business

Tort Law

Real, Personal, and Intellectual Property

Introduction to Contracts and Agreement

Consideration

Capacity and Legality

Reality of Assent

Contracts in Writing and Third-Party Contracts

Discharge and Remedies

Formation and Performance of Sales and Lease Contracts

Negotiable Instruments: Negotiability and Transferability

Holder in Due Course, Liability, and Defenses

Secured Transactions and Bankruptcy

Agency and Liability to Third Parties

Forms of Business Organization

Corporations: Formation and Organization

Securities Regulation

Employment and Discrimination Law

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