Mike Owns a House in a Low-Income Area of a Large

question 13

Multiple Choice

Mike owns a house in a low-income area of a large city.Mike is on disability,and his total monthly income is $700.A sales representative visits his home to sell him a water purification system.Mike signs a contract that calls for monthly payments of $500 for the next 10 years.The water system is worth no more than $1,000.Mike thought he was signing a permission slip allowing the salesman to conduct a free water test to determine the toxins in the water.How would a court most likely describe this contract?

• A)The contract is fully enforceable as written.
• B)The contract is unenforceable because it is unconscionable.
• C)The contract is enforceable,but only up to the value of the water system.
• D)The contract is unenforceable because it is exculpatory.

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Definitions:

FICA Taxes

Taxes imposed on both employees and employers to fund Social Security and Medicare, based on a percentage of the employees' wages.

SUTA Taxes

State Unemployment Tax Act taxes that employers pay to provide unemployment benefits to workers who lose their jobs.

FUTA Taxes

Federal unemployment taxes employers must pay, contributing to the US government's fund to support those unemployed.

Current Liability

A company's debt or obligations that are due within one year.