Which of the Following Regarding a Warranty Is NOT True

question 61

Multiple Choice

Which of the following regarding a warranty is NOT true?

• A) It is a form of consumer insurance.
• B) Consumers may buy one even if the cost of the warranty is greater than the expected future claim paid by the manufacturer.
• C) It decreases the consumer's expected utility from an item.
• D) It signals to consumers that the goods are of high quality.

---

Definitions:

Work Ethic

The principle that hard work is intrinsically virtuous or worthy of reward, emphasizing diligence, reliability, and a dedication to completing tasks.

Lower Income

A relative measure indicating a group or individual who earns less than the median or average income within a given society.

Invest More Conservatively

To allocate resources, usually finances, into lower-risk investments with the expectation of earning a steady, but possibly lower, return.

Surrogate Parents

Individuals who act in place of a child's biological parents, providing care and nurturing.