Ralph Sold a Motel to Steve by Stating That He

question 9

Multiple Choice

Ralph sold a motel to Steve by stating that he had paid $250,000 for it and that his net average annual profit from the business has been $40,000.In reality he paid $100,000 for the motel and has earned a net average annual profit of only $30,000.Steve made no attempt to verify the statements until after the transaction was completed.In this case:

• A) Ralph has committed fraudulent misrepresentation.
• B) Steve is bound by the contract, because he failed to verify the statements which were made to him.
• C) Ralph has used economic duress to compel the sale.
• D) All of these.

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Definitions:

Cold

Relates to lower temperatures or a common viral infection causing respiratory symptoms, depending on context; not typically a psychological term.

Hypersensitivity

An exaggerated or heightened response to stimuli, which can be physical, such as in allergies, or emotional, such as in mental health disorders.

Negative Evaluations

The process of critically assessing something in a manner that highlights its faults or shortcomings.

Social Anxiety Disorder

A mental health disorder characterized by significant anxiety or fear of being judged, negatively evaluated, or rejected in a social or performance situation.