2.03 warranty
The Federal Trade Commission has the authority to regulate warranties on any products that sell for more than
$15
True or False: Only express warranties hold up in court.
False: implied warranties are valid
Is an express warranty an oral promise given by the salesperson?
Yes. Whether the promise is limited or full, the seller must fulfill the promise to the customer.
The Magnuson-Moss Warranty Act of 1975 provides that warranties must be
clearly expressed
A customer buys an mp3 player and receives a printed warranty card stating the actions the company will take if the mp3 player does not work properly. This is an example of a(n) __________ warranty.
express
One way in which a business can benefit from warranties and guarantees is
feedback from customers
A warranty that covers the entire product is known as a(n) ___________ warranty.
full
"Your money back if not satisfied" is an example of a
guarantee
A promise made by the seller to the customer that the seller will refund the customer's purchase price if the product does not perform as expected is defined as a
guarantee
In its catalogs, a clothing manufacturer states: "If you are not completely satisfied with any item you buy from us, at any time during your use of it, return it and we will refund your full purchase price." This is an example of a
guarantee on goods
Holiday Inn Express uses the slogan "No excuses, guaranteed" as a money-back promise to guests. This is an example of a
guarantee on service
When customers buy televisions, they expect them to transmit pictures. This is an example of a(n) __________ warranty.
implied
Companies that build a reputation for carrying out the terms of their warranties and guarantees generally have higher sales and more repeat customers, which result in
increased profits
Sam's new car came with a warranty that ended after 12,000 miles or one year. The warranty covered major parts. This is an example of a(n) __________ warranty.
limited
One way in which customers benefit from warranties and guarantees is
reduced anxiety about purchases
Giving customers a list of locations at which they can obtain repair or replacement as part of a warranty or a guarantee provides the customer benefit of
service information
Which of the following is a purpose of warranties and guarantees:
to protect the producer and the seller
Two characteristics of a good guarantee are that it should be
unconditional and understandable
L.L. Bean promises "100% satisfaction in every way" to those who buy its goods. Items can be returned for refund or credit. This is an example of a(n)
unconditional guarantee
A promise made by the seller to the customer that the seller will repair or replace a product that does not perform as expected is defined as a
warranty