Business Law Ch 13-15

Under the provisions of the Uniform Commercial Code, which of the following holds true in regard to regulation, licensing, and taxation?

A merchant is held to a higher standard than a casual seller.

The________________ receives reports from the nation's hospitals on product-caused injuries.

Consumer Product Safety Commission (CPSC)

A breach of warranty is not a breach of contract.

False

A warranty against infringement basically requires that the goods be fit for the ordinary purposes for which such goods are used.

False

A warranty is a statement about a product's qualities or performance and therefore is not governed by the UCC.

False

An innocent third party who in good faith buys some or all of the goods from a bulk transferee cannot get a good title.

False

Casual sellers are also considered merchants.

False

In both sales and contracts to sell, the seller is known as the vendee.

False

Puffing and warranties are both statements of fact.

False

The Uniform Commercial Code (UCC) does not govern contracts to sell goods in the future.

False

Which agency at the federal level has the main responsibility for preventing false and misleading advertising?

Federal Trade Commission

FOB means _______________

Free on Board

Corrective advertising may be ordered by the FTC as a sanction for false and misleading advertising.

True

For ownership of goods to be transferred in a sale, the goods must be both existing and identified to the transaction.

True

If the buyer has had adequate opportunity to inspect the goods, acceptance may be indicated by a failure to reject them within a reasonable time.

True

The bill of sale serves as written evidence of the transfer of ownership of goods.

True

Unless goods are both existing and identified to the contract, they are categorized as future goods.

True

When both parties are merchants, a new term inserted by the offeree automatically becomes part of the contract if the offeror fails to object within a reasonable time.

True

When parties exchange goods for goods, the sale is a barter.

True

UCC stands for

Uniform Commercial Code

What governs the sale of goods as well as contracts to sell goods in the future?term-1

Universal Commercial Code

When a governmental agency acts on behalf of an injured consumer, it may utilize which of the following to correct the situation?

a cease-and-desist order or an order for restitution

A voluntary, court-enforceable agreement that stops an illegal or questionable practice is _______________

a consent order.

Individuals may sell what they do not own if they

are authorized by the owner to do so

If the seller ships goods by carrier, the transfer of the risk of loss from seller to buyer occurs_______________

at the destination upon tender of delivery by carrier.

After Brenda's mother died, the expensive items in her mother's estate were placed in a public sale and sold to the highest bidder. This type of sale is known as a(n)

auction.

Walmart places an advertisement in its local newspaper which reads "Baby Bikes only $29.95. This offer available only on Friday, April 12, when our store will open early at 6 a.m." Amber drives to Walmart at 4 a.m. and is among the first three people to enter the store to purchase the advertised bike only to learn that the item is already "sold out." A sales clerk redirects her to a better bike that costs $36.45. Walmart has used a type of improper advertising tactic known as

bait and switch.

Consideration for a sale or contract to sell goods may be expressed in the form of

barter, money, services

Frank manufactures handmade wooden baby chairs, while Joey manufactures small wooden children's desks. The two enter into an agreement in which they exchange goods for goods. This type of sale is known as a(n)

barter.

Shawn needs a new refrigerator for his home. At a local appliance store, he purchases one for $825 using his credit card. The appliance store should provide Shawn with a written receipt showing his payment and the transfer of the ownership of the refrigerator from the appliance store to him. This receipt is known as a(n)

bill of sale

A product liability suit may be based on _______________

breach of warranty, torts of fraud, negligence, or strict liability.

Transfer of ownership of goods may be done by the owners and authorized persons, or _____

by merchants with possession of sold goods, by holders of negotiable documents of title, by buyers in a sale induced by fraud

CIF stands for

cost, insurance, freight.

Under the law of contracts, a new term added to the offer by the offeree would be considered a __________ and would terminate the original offer.

counteroffer

A good-faith purchaser is one who _______________ a. purchases materials for religious organizations, b. charges goods on faith that the money will be provided, c. believes all the claims of the seller, d. none of these.

d. none of these

If the parties do not specify when the title is to pass, the courts will _______________

determine if there is any applicable custom or usage in the particular trade that can settle the question and look to the UCC for a solution.

If a person is injured as a result of an unreasonably dangerous or defective product, how will he or she most likely recover damages for the injury?

hold the retailer of the product strictly liable, hold the wholesaler strictly liable, hold the manufacturer strictly liable

Goods that might suffice but do not meet the buyer's specifications are _______________ goods.

non-conforming

Casual sellers

only sell occasionally.

According to the UCC, goods do not include

patents and copyrights

A consumer is an individual who acquired goods that he or she intends for _______________

personal, family, or household use

When contracting parties enter into a legally binding agreement, their relationship is known as _______________

privity of contract

Exaggerated sales talk such as "best on the market" or "incredible quality" is called

puffing.

Which of the following must be included in a writing evidencing a sale of goods in order to satisfy the Statute of Frauds?

quantity of the goods

An implied warranty of fitness for a particular purpose arises when the buyer _____________

relies on the seller's skill and judgment for the selection of the goods.

The Consumer Product Safety Commission (CPSC) receives reports about product failure from _______________

the distributor, the manufacturer, the consumer

A contract or clause within a contract that is grossly unfair and oppressive is said to be

unconscionable.

In a contract to sell goods, the purchaser is known as the

vendee or buyer

Sherry offers to sell her set of antique dishes to her neighbor, Joan. In this situation Sherry would be known as a(n)

vendor

Implied warranties given only by merchants include _______________

warranty of merchantability and warranty against infringement