Carla Wolfe Orders Some Inventory from Supplex Co

question 6

Multiple Choice

Carla Wolfe orders some inventory from Supplex Co. Carla calculates that if Supplex is late in delivery, she will lose about $100 a day in profits. They agree to specify in the purchase order that Supplex will pay Carla $100 a day if late. What is this clause called?

• A)Penalty clause
• B)Liquidated damages clause
• C)Pre-estimated clause
• D)Guarantee clause
• E)Defeasance clause

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Definitions:

Implied Warranty

A legal theory in commerce that holds sellers responsible for ensuring the products sold are suitable for their intended use, even if not explicitly stated.

Puffing

Exaggerated or boastful statements about a product or service that are subjective and not meant to be taken literally.

Restatement Of Contracts

A comprehensive set of principles regarding contract law drafted by legal scholars to help clarify and unify the law of contracts.

Magnuson-Moss Act

A federal law enacted to protect consumers from deceptive warranty practices, ensuring warranties on consumer products are clear and enforceable.