Divided Parcel (DP) Includes the Following on Its Mailing Receipts

question 48

Multiple Choice

Divided Parcel (DP) includes the following on its mailing receipts: "We are not responsible for any damages to packages whether or not through the fault or negligence of our employees.Send packages at your own risk." Mary reads this clause but sends her watch back to its manufacturer to be repaired anyway.The watch is destroyed when the DP driver negligently drops and runs over the package.Mary is:

• A)out of luck because the clause was communicated to her.
• B)out of luck because she should have insured the package.
• C)likely to collect from DP since exculpatory clauses always violate public policy.
• D)likely to collect from DP because it is a common carrier.

---

Definitions:

Utility Function

A function that captures the level of satisfaction or happiness that consumers derive from consuming various combinations of goods and services.

Initial Allocation

The initial distribution of goods, resources, or entitlements among individuals or groups before any trade or market exchange occurs.

Contract Curve

In economics, it is a curve that shows the set of mutually beneficial (efficient) allocations in a trade or exchange situation.

Edgeworth Box

A diagram used in microeconomics to show the distribution of resources and the optimal allocation between two individuals.