Question 1

The ____ describes the origin of the shipment,provides specific directions for the carrier,delineates the transportation contract terms,and functions as a receipt for the shipment.

Accepted Answer

The bill of lading is a document that includes information about the origin of the shipment, specific instructions for the carrier, transportation contract terms, and serves as a receipt for the shipment. It is a crucial document in the transportation of goods.

Question 2

A/An ____ provision stipulates the mechanism to be used in determining any costs and damages to the injured party in the event of a breach of contract.

Accepted Answer

A liquidated damages provision is a contractual provision that specifies the amount of damages to be paid by the breaching party in the event of a contract breach. This provision acts as a pre-arranged direct agreement between the parties as to the amount of damages which an injured party can recover. This provision typically sets forth a reasonable amount for damages that will be assessed in the event of a breach. This prevents the non-breaching party from having to hire a financial expert to determine damages.

Question 3

____ include expenses reasonably incurred in inspection,receipt,transportation,and the care and custody of goods appropriately rejected by the purchaser.

Accepted Answer

The expenses incurred in inspection, receipt, transportation, and the care and custody of goods appropriately rejected by the purchaser are known as incidental damages.

Question 4

Which of the following is false regarding the acceptance and rejection of goods?

Accepted Answer

This statement is false. The purchaser's rights and obligations are just as important as the supplier's. Both parties have legal rights and responsibilities when it comes to the acceptance and rejection of goods.

Question 5

On ____,the freight bill is presented on the effective day of the shipment.

Accepted Answer

Prepaid shipments mean that the shipper has already paid for the transportation costs, therefore the freight bill is presented on the effective day of the shipment. FOB origin shipments mean that the buyer bears the transportation costs and takes responsibility for the goods once they leave the origin, so the freight bill is presented after the shipment has been delivered to the destination. Collect shipments mean that the buyer pays for transportation costs upon receipt of the goods, so the freight bill is presented after the shipment has been delivered. FOB destination shipments mean that the seller bears the transportation costs and takes responsibility for the goods until they reach the destination, so the freight bill is presented after the goods have been delivered at the destination. None of these choices is not a correct answer in this case.

Question 6

____ are equal to the difference between the value of the purchased goods at the time of delivery and the goods' value at the time of specified delivery.

Accepted Answer

The answer of ____ are equal to the difference between...

Question 7

____ can be defined as failure of one of the parties to live up to the terms and conditions of the contract.

Accepted Answer

Cancellation for default refers to the termination of a contract due to the failure of one of the parties to fulfill their obligations as outlined in the contract. This can include failure to pay, failure to deliver goods or services, or any other breach of contract.

Question 8

____ essentially indicates that the supplier warrants that it has ownership of the goods and that they are not stolen or subject to any security interest or liens.

Accepted Answer

The warranty of title essentially indicates that the supplier warrants that they have ownership of the goods and that they are not stolen or subject to any security interest or liens.

Question 9

Which of the following is not one of the benefits that the UCC provides to buyers?

Accepted Answer

All the choices listed are benefits provided by the UCC to buyers, so none of them is not a benefit.

Question 10

In its most basic form,a ____ is defined as a promise of representation made by the seller,which,if necessary,can be legally enforced.

Accepted Answer

A warranty is a promise made by the seller regarding the quality and condition of the item being sold. It is a legally binding agreement that provides the buyer with certain rights and remedies in case the seller fails to honor the warranty. A warranty can be express or implied, and may cover different aspects of the product such as its fitness for a particular purpose, merchantability, and title.

Question 11

Which of the following is a category of contract cancellation?

Accepted Answer

All of these choices are categories of contract cancellation. Cancellation for default occurs when one party fails to perform according to the terms of the contract. Cancellation for convenience of the purchaser occurs when the purchaser decides they no longer want or need the goods or services. Cancellation by mutual assent occurs when both parties agree to cancel the contract. Anticipatory breach occurs when one party indicates that they will not perform their obligations under the contract, giving the other party the right to cancel.

Question 12

After the point of acceptance,the supplier's rights ____ and the purchaser's rights ____.

Accepted Answer

After the point of acceptance, the supplier's rights increase because they now have the right to payment for the goods or services provided. The purchaser's rights decrease because they have already accepted the goods or services and can no longer reject them.

Question 13

The ____ means when the seller at the time of contracting has reason to know of any particular purpose for which the goods are required,and the buyer is relying on the seller's skill or judgment to select or furnish suitable goods.

Accepted Answer

The implied warranty of fitness for use applies when the seller is aware of a specific purpose for which the buyer is purchasing the goods and the buyer is relying on the seller's expertise to provide suitable goods. This warranty is implied by law and does not need to be explicitly stated in the contract.

Question 14

According to the UCC,any affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates a/an ____ that the goods shall conform to the affirmation or promise.

Accepted Answer

The UCC specifies that any affirmation of fact or promise made by the seller to the buyer that becomes part of the basis of the bargain creates an express warranty that the goods shall conform to that affirmation or promise. Therefore, the best choice is option B, which refers to an express warranty.

Question 15

____ refers to the supplier's guarantee that the goods being exchanged do not illegally violate another party's patent protection.

Accepted Answer

Warranty of infringement refers to the supplier's guarantee that the goods being exchanged do not illegally violate another party's patent protection.

Question 16

____ is money the plaintiff actually paid to the defendant in connection with the contract.

Accepted Answer

Restitution refers to the return of money or property that the plaintiff has paid to the defendant in connection with the contract. Reliance refers to expenses the plaintiff incurred in reliance on the contract, and expectancy refers to the amount the plaintiff expected to receive from the contract. Due diligence is unrelated to this concept.

Question 17

____ are those expenses incurred by the purchaser because the goods were not delivered when expected or as specified.

Accepted Answer

Consequential damages are those expenses that are the result of unforeseen and indirect consequences of a breach of contract. In this case, the expenses incurred by the purchaser due to the goods not being delivered on time or as specified would be considered consequential damages. Incidental damages (A) are the direct expenses incurred as a result of a breach, such as storage fees or transportation costs. General damages (B) are damages for losses that naturally flow from a breach of contract, such as lost profits. Specific damages (D) are damages that can be specifically quantified and proven, such as the cost of repair for a damaged piece of equipment.

Question 18

____ is money the plaintiff was hoping to gain from the contract.

Accepted Answer

Expectancy refers to the amount of money the plaintiff was hoping to gain from the contract, also known as the anticipated profits or benefits under the agreement. Reliance and restitution refer to different types of damages in contract law, while remediation is not a recognized term in this context.

Question 19

Rather than change existing contract law,in 1999 the ____ adapted existing "paper and pencil" concepts to the electronic age,meaning that it makes electronic records equivalent to written documents and electronic signatures similar to handwritten signatures for legal purposes.

Accepted Answer

The Electronic Signatures in Global and National Commerce Act (ESIGN) was passed in 2000, but the Uniform Electronic Transactions Act (UETA) was the first law to adapt existing paper-based concepts to the electronic age in 1999. UETA is a uniform law that has been adopted by 47 states, and it makes electronic records and signatures equivalent to paper documents and handwritten signatures for legal purposes.

Question 20

____ is money the plaintiff lost because he or she was relying on the contract,depending on the defendant to live up to his/her obligations under the contract.

Accepted Answer

Reliance is the money the plaintiff lost because they relied on the defendant to fulfill their obligations under the contract. The plaintiff had a reasonable expectation that the defendant would perform as promised, and thus, they suffered financial harm when the defendant failed to do so.

Quiz 15: Purchasing Law and Ethics