What Made 'Caveat Emptor' a Poor Idea on Which to Base

question 14

Multiple Choice

What made 'caveat emptor' a poor idea on which to base the law regulating consumer transactions in the 20th Century was the fact that true equality of bargaining power between buyers and businesses had become:

• A)Commonplace.
• B)Rare.
• C)Unnecessary.
• D)Impossible to achieve unless both parties spoke Latin.

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Definitions:

Student Loans

Borrowed money that is used to pay for educational expenses and is expected to be paid back with interest.

Discount Rate

The rate of interest applied to loans provided to commercial banks and other financial institutions by the Federal Reserve through its discount window.

Present Value

The contemporary valuation of a sum of money to be received in the future, or of ongoing cash flows, based on an agreed upon return rate.

Cash Flows

The total amount of money being transferred into and out of a business, especially as affecting liquidity.