Which of the following 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 typically increases a consumer's expected utility from an item by providing assurance against defects or failures, rather than decreasing it.

Which of the Following Regarding a Warranty Is NOT True