Which of the Following Statements About Misrepresentation Is True

question 12

Multiple Choice

Which of the following statements about misrepresentation is true?

• A)When salespeople loosely describe their product or service in glowing terms, those statements can be relied upon by the potential buyer.
• B)Generally, the more knowledgeable the customer, the greater the chances the court will interpret an incorrect statement by a salesperson as an actionable misrepresentation.
• C)When a salesperson makes claims of a "factual nature" regarding a service's inherent capabilities, the law does not treat these comments as statements of fact and warranties.
• D)A salesperson's opinion regarding the quality of the product being sold is known as sales puffery, and is not legally actionable.
• E)Even if the salesperson misrepresentation statement is made innocently, most courts will award damages to the customer.

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Definitions:

Market Price

The current amount at which an asset or service can be bought or sold.

Dividends Per Share

Measures the extent to which earnings are being distributed to common shareholders.

Liquidity

The simplicity of turning an asset into cash without impacting its market value.

Asset Turnover Ratio

A financial metric that measures the efficiency of a company using its assets to generate sales or revenue.