Question 1

Kirsten just bought a car that had a one-year warranty stating that it covered the cost of parts, but not labor. It also stated that the warranty only covered the powertrain, and no other part. What kind of warranty did Kirsten's car have?

Accepted Answer

Kirsten's car had a limited warranty that only covered the cost of parts, but not labor. The warranty also only covered the powertrain and no other part.

Question 2

The Magnuson-Moss Warranty Act does not govern warranties of commercial or industrial transactions.

Accepted Answer

The Magnuson-Moss Warranty Act only governs warranties for consumer products and does not apply to commercial or industrial transactions.

Question 3

StoryBoard Creatives approached Logos Studios with a script for a movie. Logos Studios liked the script, and bought the rights for the script from StoryBoard. Subsequently, Mr. Simpson, a former employee of StoryBoard claimed that he had the copyright to that script. Mr. Simpson proved his copyright in court. He then notified Logos Studios that they could not start production on the script without his permission, and adequate payment of fees. Logos Studios then rescinded the contract with StoryBoard based on the breach of ________.

Accepted Answer

The correct answer is B) warranty against infringements. This is because StoryBoard Creatives implicitly warranted that the script did not infringe on anyone else's copyright when they sold the rights to Logos Studios. When Mr. Simpson proved his copyright, it showed that StoryBoard breached this warranty.

Question 4

The ________ is a federal statute that regulates written warranties on consumer products.

Accepted Answer

The Magnuson-Moss Warranty Act is a federal statute that regulates warranties on consumer products, including written warranties. The other answer choices are incorrect and do not refer to an actual federal statute.

Question 5

What type of transaction is covered under the Magnuson-Moss Warranty Act?

Accepted Answer

The Magnuson-Moss Warranty Act is a federal law that applies to consumer products. It requires sellers and manufacturers to provide clear and easy-to-understand warranty information to consumers for products sold at $15 or more. It provides protection to consumers who purchase products that have a warranty against defects and malfunctions. Therefore, the Act covers only consumer transactions.

Question 6

In a limited warranty, the warrantor must guarantee that a defective product will be repaired or replaced free during the warranty period.

Accepted Answer

A limited warranty may not cover all repair or replacement costs and may have specific conditions or limitations.

Question 7

A full warranty is an example of a(n) ________.

Accepted Answer

A full warranty is a type of express warranty, which explicitly promises that the product will function as intended and will be free from defects or malfunctions for a specified period of time. This is different from implied warranties, which are not explicitly stated but are implied by law (such as the implied warranty of fitness for a particular purpose). A disclaimer warranty is a type of warranty that limits the liability of the seller or manufacturer and is not applicable in this case. The implied warranty of fitness for human consumption is specific to food products and would not apply in this context.

Question 8

What is the difference between a full warranty and a limited warranty?

Accepted Answer

The answer of What is the difference between a full...

Question 9

Limited warranties are made more often by sellers and lessors than are full warranties.

Accepted Answer

Limited warranties are more common in the marketplace because they offer less protection and are less expensive for the seller or lessor to offer. Full warranties provide comprehensive coverage for a longer period of time and are less common.

Question 10

Which of the following is true of the Magnuson-Moss Warranty Act?

Accepted Answer

The Magnuson-Moss Warranty Act authorizes warrantors to establish an informal dispute-resolution procedure, which can be used to settle warranty disputes without going to court. The Act does not require all warrantors to make express written warranties (A), or obligate them to make disclaimer warranties for their products (B). Implied warranties are not voidable under this Act (D).

Question 11

A warranty that guarantees that a defective product will be repaired or replaced free during the warranty period is known as a(n) ________.

Accepted Answer

A full warranty guarantees that a defective product will be repaired or replaced free during the warranty period. An implied warranty is not explicitly stated but is assumed by law, and may not cover all defects. A disclaimer warranty limits the manufacturer's liability and may not cover all defects. A limited warranty covers only certain parts or types of defects, and may require the customer to bear some of the repair or replacement costs.

Question 12

What of the following is true of an "as is" disclaimer?

Accepted Answer

An "as is" disclaimer is a statement in which the seller makes it clear that the buyer is purchasing a product in its current condition without any guarantees or warranties. It disclaims all implied warranties that would otherwise be associated with the sale of the product, including the warranty of merchantability and the warranty of fitness for a particular purpose. Express warranties, on the other hand, are statements or promises made by the seller regarding the quality or performance of the product, and they are not impacted by an "as is" disclaimer.

Question 13

Eliza buys a car from TinCar Autos with a warranty that says that any defect of the car will be repaired or replaced free for a period of six months after the sale. TinCar has taken security interests in the car. Before completely paying for the car, Eliza sells the car to Mona for cash. Mona is unaware of TinCar's security interest in the car. After Eliza misses several of her payments, TinCar discovers that Mona has the car, and repossesses it. What kind of warranty did TinCar provide to Eliza?

Accepted Answer

The answer of Eliza buys a car from TinCar Autos...

Question 14

Eliza buys a car from TinCar Autos with a warranty that says any defect of the car will be repaired or replaced free for a period of six months after the sale. TinCar has taken security interests in the car. Before completely paying off for the car, Eliza sells the car to Mona for cash. Mona is unaware of TinCar's security interest in the car. After Eliza misses several of her payments, TinCar discovers that Mona has the car, and repossesses it. Which warranty breach can Mona assert to recover from Eliza?

Accepted Answer

Mona can assert a breach of the warranty of no security interests because Eliza sold the car to Mona without disclosing TinCar's security interest, which is a breach of this warranty.

Question 15

A ________ is a warranty in which sellers of goods warrant that the goods they sell are delivered free from any third-party security interests, liens, or encumbrances that are unknown to the buyer.

Accepted Answer

A warranty of no security interests ensures that the goods are free from any third-party security interests, liens, or encumbrances unknown to the buyer.

Question 16

The Magnuson-Moss Warranty Act does not require a seller or lessor to make an express written warranty.

Accepted Answer

The Magnuson-Moss Warranty Act only outlines the requirements for written warranties that are provided, but it does not require sellers or lessors to provide a written warranty.

Question 17

Monty, a career criminal, steals a diamond from Prime Cut Jewelers. He then sells it to Adamas Jewelers, who is unaware of the stolen nature of the diamond. If Prime Cut discovers that the diamond is with Adamas, and reclaims the diamond, what warranty breach can Adamas declare to recover the cost from Monty?

Accepted Answer

The warranty of good title is breached when the seller fails to provide clear and marketable title to the buyer. In this case, Monty, who is not the rightful owner of the diamond, sold it to Adamas. Therefore, Adamas can declare a breach of warranty of good title and recover the cost from Monty. The other warranty options do not apply in this scenario.

Question 18

A warranty in which the seller warrants that he or she has valid title to the goods he or she is selling and that the transfer of title is rightful is known as a warranty ________.

Accepted Answer

A warranty of good title assures a buyer that the seller is the rightful owner of the goods and has the legal authority to sell them. It also guarantees that there are no liens, claims or other legal encumbrances on the property that might affect the buyer's ownership.

Question 19

A ________ is a warranty in which the lessor warrants that no person holds a claim or an interest in the goods that arose from an act or omission of the lessor that will interfere with the lessee's enjoyment of his or her leasehold interest.

Accepted Answer

A warranty of quiet possession is a guarantee that the lessee will be able to use and enjoy the leased property without any interference from the lessor or any third parties claiming an interest in the property. This warranty is often included in commercial leases and is intended to protect the lessee from any claims of title or ownership that could disrupt their business operations.

Question 20

An automatic warranty provided by a seller or lessor who is a merchant that regularly deals in goods of the kind sold or leased which warrants that the goods are delivered free of any third-party patent, trademark, or copyright claim is known as ________.

Accepted Answer

The correct term is "warranty against infringements," which assures the buyer or lessee that the goods sold or leased are free from any third-party claims of infringement on patents, trademarks, or copyrights.

Quiz 21: Warranties