Jacob Bought a Widget from Erin for $15 000

question 57

Multiple Choice

Jacob bought a widget from Erin for $15 000. In payment, he gave her a cheque that was payable to her. The cheque was drawn on his account at the Bank of Kitchener. Erin signed her name on the back of the cheque and delivered it to Arthur in order to discharge a debt that she owed to him. Arthur presented the instrument to the Bank of Kitchener for payment, but was refused payment because the balance for Jacob's account was only $8000. Which of the following statements is TRUE?

• A) Arthur has a right to collect $8000 from the bank.
• B) Arthur should provide notice of dishonour to the bank's manager as soon as possible.
• C) Notice of dishonour will be effective only if it is made in writing.
• D) If the widget that Jacob bought from Erin is defective, Arthur cannot acquire any rights against the drawer of the cheque.
• E) Arthur may be able to sue Jacob, but not Erin.

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Definitions:

Price Lining

A pricing strategy that involves offering products at several different price points to provide options for different customer segments.

Price Lining

A pricing strategy that sets a limited number of prices for a specific category of products, thereby simplifying the choices available to consumers.

Demand-oriented

A pricing strategy where the price is set based on consumer demand, often adjusting prices in response to market conditions.

Target Pricing

A pricing strategy in which the selling price of a product is determined based on the desired profit margin and market conditions.