Which Statement Regarding a Warranty Is NOT True

question 165

Multiple Choice

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.

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Definitions:

Transmission

A system in vehicles that transmits power from the engine to the drive axle, enabling the change of gears and varying the power and speed ratio.

Output Shaft Speed

The rotational speed of the shaft that delivers power from a transmission or differential to the wheels or other driven components.

Allison Transmission

A brand known for manufacturing automatic transmissions for heavy-duty and commercial vehicles.

Planetary Gearset

A compact, round gear system that consists of a central sun gear, ring gear, and several planet gears that orbit the sun gear, used for transmission systems to provide multiple gear ratios.