Question 1

The Magnuson-Moss Act requires a full warranty on the sale of goods.

Accepted Answer

A) True 
 B)False  False

Question 2

Unless otherwise specified,which of the following is true regarding warranties in Hong Kong?

Accepted Answer

A) Warranties are not recognized in Hong Kong. 
B) Time of payment and delivery are considered warranties. 
C) Conditions are considered the same as warranties. 
D) Delivery is considered a warranty,but time of payment is not considered a warranty. 
E) Time of payment is considered a warranty,but delivery is not considered a warranty. 
A) Warranties are not recognized in Hong Kong. 
B) Time of payment and delivery are considered warranties. 
C) Conditions are considered the same as warranties. 
D) Delivery is considered a warranty,but time of payment is not considered a warranty. 
E) Time of payment is considered a warranty,but delivery is not considered a warranty. B

Question 3

What options does the UCC give states in regard to warranties extending to third-party beneficiaries of warranties,and which option have most states adopted?

Accepted Answer

The states are given the following three choices regarding third-party beneficiaries of warranties:
1.Seller's warranties extend to the buyer's household members and guests.
2.Seller's warranties extend to any reasonable and foreseeable user.
3.Seller's warranties extend to anyone injured by the good.

Question 4

Which statement is true regarding the implied warranty of fitness for a particular purpose?

Accepted Answer

A) It applies in every sales transaction involving a merchant. 
B) It applies in every case in which an implied warranty of merchantability is found. 
C) It may be applied to sellers who are not merchants. 
D) It is a common law doctrine not followed by the UCC which recognizes only the implied warranty of merchantability. 
E) It applies in every case in which an express warranty is found. 
A) It applies in every sales transaction involving a merchant. 
B) It applies in every case in which an implied warranty of merchantability is found. 
C) It may be applied to sellers who are not merchants. 
D) It is a common law doctrine not followed by the UCC which recognizes only the implied warranty of merchantability. 
E) It applies in every case in which an express warranty is found.

Question 5

Is the manager correct that the store never offers express or implied warranties on products?

Accepted Answer

A) No,because the computer was sold with a warranty of merchantability. 
B) No,because the computer was sold with a warranty of merchantability,with a warranty of fitness for a particular purpose,and also with an express warranty. 
C) No,because the computer was sold with a warranty of merchantability and also with a warranty of fitness for a particular purpose. 
D) Yes,because unless Carmen had a written promise specifically providing for a warranty,the computer was sold without a warranty. 
E) Yes,because unless Carmen had an oral promise specifically promising a warranty or a written contract specifically providing for a warranty,the computer was sold without a warranty. 
A) No,because the computer was sold with a warranty of merchantability. 
B) No,because the computer was sold with a warranty of merchantability,with a warranty of fitness for a particular purpose,and also with an express warranty. 
C) No,because the computer was sold with a warranty of merchantability and also with a warranty of fitness for a particular purpose. 
D) Yes,because unless Carmen had a written promise specifically providing for a warranty,the computer was sold without a warranty. 
E) Yes,because unless Carmen had an oral promise specifically promising a warranty or a written contract specifically providing for a warranty,the computer was sold without a warranty.

Question 6

Under the UCC,the buyer must bring a lawsuit on a breached contract within years)of when the breach occurred or when the buyer became aware of it.

Accepted Answer

A) One 
B) Six 
C) Two 
D) Three 
E) Four 
A) One 
B) Six 
C) Two 
D) Three 
E) Four

Question 7

According to the rule of privity,warranties may not extend to third parties to a contract.

Accepted Answer

A) True 
 B)False

Question 8

In order for the implied warranty of merchantability to be applied,which of the following is required?

Accepted Answer

A) Both parties must be merchants and a sale,not a lease,must be involved. 
B) The seller must be a merchant and a sale,not a lease,must be involved. 
C) The seller must be a merchant,and either a sale or lease must be involved. 
D) Both parties must be merchants,and either a sale or lease must be involved. 
E) The seller must be a merchant,goods valued at over $500 must be involved,and either a sale or lease must be involved. 
A) Both parties must be merchants and a sale,not a lease,must be involved. 
B) The seller must be a merchant and a sale,not a lease,must be involved. 
C) The seller must be a merchant,and either a sale or lease must be involved. 
D) Both parties must be merchants,and either a sale or lease must be involved. 
E) The seller must be a merchant,goods valued at over $500 must be involved,and either a sale or lease must be involved.

Question 9

Lexi purchased a new printer for her business from XYZ Company.Three years to the day after she purchased the printer,she started noticing problems with it.She negotiated with XYZ Company,but was unable to get a resolution of her problems.She sued XYZ Company four years and one day after she bought the printer.XYZ Company defended on the basis that it was only the seller,not the manufacturer,and also on the basis of the statute of limitations.Assuming the printer is defective and the court follows the reasoning of the case in the text Melissa Kahn v.Volkswagen of America Inc. ,which of the following is a true statement regarding the positions of the parties?

Accepted Answer

A) XYZ Company will win because although Lexi correctly sued the seller,Lexi filed suit outside the four year statute of limitations. 
B) Lexi will win because she can hold XYZ Company responsible and because there is no statute of limitations for business goods of this type. 
C) XYZ Company will win because in such situations Lexi must sue the manufacturer and also because Lexi filed suit outside the four year statute of limitations. 
D) Lexi will be allowed to proceed because she can hold XYZ Company responsible and because the statute of limitation was tolled during negotiations,she sued on a timely basis. 
E) XYZ Company will win because although Lexi sued within the statute of limitations,in such situations Lexi must sue the manufacturer. 
A) XYZ Company will win because although Lexi correctly sued the seller,Lexi filed suit outside the four year statute of limitations. 
B) Lexi will win because she can hold XYZ Company responsible and because there is no statute of limitations for business goods of this type. 
C) XYZ Company will win because in such situations Lexi must sue the manufacturer and also because Lexi filed suit outside the four year statute of limitations. 
D) Lexi will be allowed to proceed because she can hold XYZ Company responsible and because the statute of limitation was tolled during negotiations,she sued on a timely basis. 
E) XYZ Company will win because although Lexi sued within the statute of limitations,in such situations Lexi must sue the manufacturer.

Question 10

Which position have most states adopted in regard to warranty rights of third parties?

Accepted Answer

A) Seller's warranties extend to the buyer and the buyer's family only. 
B) Seller's warranties extend to the buyer's household members and guests. 
C) Seller's warranties extend to the buyer only. 
D) Seller's warranties extend to anyone injured by the good. 
E) Seller's warranties extend to any reasonable and foreseeable user. 
A) Seller's warranties extend to the buyer and the buyer's family only. 
B) Seller's warranties extend to the buyer's household members and guests. 
C) Seller's warranties extend to the buyer only. 
D) Seller's warranties extend to anyone injured by the good. 
E) Seller's warranties extend to any reasonable and foreseeable user.

Question 11

A seller may disclaim an implied warranty successfully even if the disclaimer in the contract is confusing.

Accepted Answer

A) True 
 B)False

Question 12

A salesperson gives the buyer a scale model of the sofa that he is building.The buyer purchases the sofa but it does not look exactly like the scale model.Does the buyer have an express warranty based on the model?

Accepted Answer

A) No because the model was just an example of puffing. 
B) Yes,a sample or model may provide an express warranty. 
C) No because express warranties must be written. 
D) No,but the model created an implied warranty. 
E) No because the model did not claim to make representations. 
A) No because the model was just an example of puffing. 
B) Yes,a sample or model may provide an express warranty. 
C) No because express warranties must be written. 
D) No,but the model created an implied warranty. 
E) No because the model did not claim to make representations.

Question 13

A salesperson selling a knife tells the potential buyer: "This knife can cut through a phone book.Guaranteed!".Does this statement create a warranty?

Accepted Answer

A) Yes,an express warranty. 
B) No because it is puffing. 
C) No because it is just a sales persons statement. 
D) Yes,an implied warranty 
E) No because it is not in writing. 
A) Yes,an express warranty. 
B) No because it is puffing. 
C) No because it is just a sales persons statement. 
D) Yes,an implied warranty 
E) No because it is not in writing.

Question 14

Which of the following terms refers to assurances by one party that the other party can rely on its representations of fact?

Accepted Answer

A) Contractual promises 
B) Warranties 
C) Consensual promises 
D) Affirmances 
E) Engagements 
A) Contractual promises 
B) Warranties 
C) Consensual promises 
D) Affirmances 
E) Engagements

Question 15

Express warranties may be found in advertisements.

Accepted Answer

A) True 
 B)False

Question 16

A buyer purchases a car at a sheriff's sale of seized goods.Later,the buyer discovers that there is a lien on the car.Can the buyer recover from the seller for breaching the warranty of title?

Accepted Answer

A) Yes because the UCC specifically permits buyers to recover from sellers who have breached warranties of title. 
B) Yes,because UCC assumes that the seller has good and valid title to goods. 
C) No,because this is an exception to the warranty of title because the seller was obviously unable to guarantee title. 
D) Yes because there are no exceptions to title warranties. 
E) Yes because the UCC assumes that the seller has the right to transfer title free and clear. 
A) Yes because the UCC specifically permits buyers to recover from sellers who have breached warranties of title. 
B) Yes,because UCC assumes that the seller has good and valid title to goods. 
C) No,because this is an exception to the warranty of title because the seller was obviously unable to guarantee title. 
D) Yes because there are no exceptions to title warranties. 
E) Yes because the UCC assumes that the seller has the right to transfer title free and clear.

Question 17

If a buyer fails to comply with the statute of limitations,what is the effect?

Accepted Answer

A) It results in the plaintiff only having the right to sue for damages,not injunctive relief. 
B) It operates as a waiver of warranty rights only if the defendant can establish that the plaintiff had actual knowledge of the statute of limitations. 
C) There is no effect so long as the plaintiff can establish that he or she was not aware of the statute of limitations. 
D) It operates as a waiver of warranty rights under the contract. 
E) It results in the plaintiff only having the right to sue for injunctive relief,not damages. 
A) It results in the plaintiff only having the right to sue for damages,not injunctive relief. 
B) It operates as a waiver of warranty rights only if the defendant can establish that the plaintiff had actual knowledge of the statute of limitations. 
C) There is no effect so long as the plaintiff can establish that he or she was not aware of the statute of limitations. 
D) It operates as a waiver of warranty rights under the contract. 
E) It results in the plaintiff only having the right to sue for injunctive relief,not damages.

Question 18

Joann makes doll clothing and Jesse makes custom glue in his basement.Joann wants to buy some of Jesse's glue.Joann visits Jesse and says she needs a glue that will work on fabric.Jesse sells her a tube of Super Special Glue,but it does not work on fabric at all.Does Joann have a warranty claim?

Accepted Answer

A) Yes,an express warranty. 
B) No,because Jesse is not a merchant. 
C) Yes,an implied warranty of fitness for a particular purpose. 
D) No,because Jesse couldn't possibly know if the glue would work on fabric. 
E) It depends upon whether the glue works on any other materials or not. 
A) Yes,an express warranty. 
B) No,because Jesse is not a merchant. 
C) Yes,an implied warranty of fitness for a particular purpose. 
D) No,because Jesse couldn't possibly know if the glue would work on fabric. 
E) It depends upon whether the glue works on any other materials or not.

Question 19

A sample or model may provide an express warranty.

Accepted Answer

A) True 
 B)False

Question 20

Perry and Tim negotiate a contract governed by the UCC.Tim wants to extend the time to make a warranty claim,so Perry and Tim agree that Tim could sue for breach any time within eight years.Tim sues for breach after six years.Can Tim make a claim?

Accepted Answer

A) Yes because there is a 10 year statute of limitations under the UCC 
B) It depends upon the contract terms. 
C) Yes,because the parties are free to negotiate any statute of limitation they want. 
D) No,because parties to a contract are never allowed to negotiate on the statute of limitation. 
E) No,because the UCC requires a lawsuit to be brought within four years and parties to a contract are not free to negotiate a longer time period than the UCC's four year limit. 
A) Yes because there is a 10 year statute of limitations under the UCC 
B) It depends upon the contract terms. 
C) Yes,because the parties are free to negotiate any statute of limitation they want. 
D) No,because parties to a contract are never allowed to negotiate on the statute of limitation. 
E) No,because the UCC requires a lawsuit to be brought within four years and parties to a contract are not free to negotiate a longer time period than the UCC's four year limit.

Exam 25: Warranties

The Magnuson-Moss Act requires a full warranty on the sale of goods.

Unless otherwise specified,which of the following is true regarding warranties in Hong Kong?

What options does the UCC give states in regard to warranties extending to third-party beneficiaries of warranties,and which option have most states adopted?

Which statement is true regarding the implied warranty of fitness for a particular purpose?

Is the manager correct that the store never offers express or implied warranties on products?

Under the UCC,the buyer must bring a lawsuit on a breached contract within years)of when the breach occurred or when the buyer became aware of it.

According to the rule of privity,warranties may not extend to third parties to a contract.

In order for the implied warranty of merchantability to be applied,which of the following is required?

Which position have most states adopted in regard to warranty rights of third parties?

A seller may disclaim an implied warranty successfully even if the disclaimer in the contract is confusing.

A salesperson gives the buyer a scale model of the sofa that he is building.The buyer purchases the sofa but it does not look exactly like the scale model.Does the buyer have an express warranty based on the model?

A salesperson selling a knife tells the potential buyer: "This knife can cut through a phone book.Guaranteed!".Does this statement create a warranty?

Which of the following terms refers to assurances by one party that the other party can rely on its representations of fact?

Express warranties may be found in advertisements.

A buyer purchases a car at a sheriff's sale of seized goods.Later,the buyer discovers that there is a lien on the car.Can the buyer recover from the seller for breaching the warranty of title?

If a buyer fails to comply with the statute of limitations,what is the effect?

Joann makes doll clothing and Jesse makes custom glue in his basement.Joann wants to buy some of Jesse's glue.Joann visits Jesse and says she needs a glue that will work on fabric.Jesse sells her a tube of Super Special Glue,but it does not work on fabric at all.Does Joann have a warranty claim?

A sample or model may provide an express warranty.

Perry and Tim negotiate a contract governed by the UCC.Tim wants to extend the time to make a warranty claim,so Perry and Tim agree that Tim could sue for breach any time within eight years.Tim sues for breach after six years.Can Tim make a claim?

An Introduction to Dynamic Business Law

Business Ethics

The Uslegal System

Alternative Dispute Resolution

Constitutional Principles

International and Comparative Law

Crime and the Business Community

Tort Law

Negligence and Strict Liability

Product Liability

Liability of Accountants and Other Professionals

Intellectual Property

Introduction to Contracts

Agreement

Consideration

Capacity and Legality

Legal Assent

Contracts in Writing

Third-Party Rights to Contracts

Discharge and Remedies

Introduction to Sales and Lease Contracts

Title,risk of Loss,and Insurable Interest

Performance and Obligations Under Sales and Leases

Remedies for Breach of Sales and Lease Contracts

Negotiable Instruments: Negotiability and Transferability

Negotiation, holder in Due Course, and Defenses

Liability, defenses, and Discharge

Checks and Electronic Fund Transfers

Secured Transactions

Other Creditors Remedies and Suretyship

Bankruptcy and Reorganization

Agency Formation and Duties

Liability to Third Parties and Termination

Forms of Business Organization

Partnerships: Nature, formation, and Operation

Partnerships: Termination and Limited Partnerships

Corporations: Formation and Financing

Corporations: Directors, officers, and Shareholders

Corporations: Mergers, consolidations, terminations

Corporations: Securities and Investor Protection

Employment and Labor Law

Employment Discrimination

Administrative Law

Consumer Law

Environmental Law

Antitrust Law

The Nature of Property, personal Property, and Bailments

Real Property

Landlord-Tenant Law

Insurance Law

Wills and Trusts

Filters