Which statement regarding a warranty is NOT true?
A)It is a form of consumer insurance.
B)Consumers may buy one,even if the cost of the warranty is greater than the expected future claim paid by the manufacturer.
C)It decreases the consumer's expected utility from an item.
D)It signals to consumers that the goods are of high quality.

Question

Quizplus · Accepted Answer

A warranty does not decrease a consumer's expected utility from an item. In fact, it may increase it by providing peace of mind and protecting their investment.

Which Statement Regarding a Warranty Is NOT True