Which of the Following Transactions Is Protected by the Three-Day

question 117

Multiple Choice

Which of the following transactions is protected by the three-day rescission rights?

• A)A contract for a home equity line of credit.
• B)A contract for the purchase of a sofa for a home entered into at the furniture store with payments over 12 months and finance charges of 19 percent.
• C)A contract for construction of a swimming pool entered into at the pool company office with payment in cash.
• D)All of the above are covered by the three-day rescission rights.

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Definitions:

Perfectly Competitive Industry

An industry characterized by many buyers and sellers, where no single entity can influence the market price of the product.

Marginal Cost

The price of manufacturing an incremental unit of a product.

Perfectly Competitive Market

A market structure characterized by an infinite number of buyers and sellers, identical products, no barriers to entry or exit, and perfect information among all participants.

Short-run Industry

A period in which at least one factor of production is fixed, and firms can only partially adjust their production levels.