Rita, a Minor, Misrepresents Her Age as Twenty-One and Signs

question 31

Multiple Choice

Rita, a minor, misrepresents her age as twenty-one and signs a contract with Sporty Motors to buy a sport utility vehicle (SUV. In most states, Rita may​

• A) ​disaffirm the contract.
• B) ​disaffirm the contract only if she makes full payment.
• C) ​disaffirm the contract only if she returns the SUV in good condition.
• D) ​not disaffirm the contract due to the misrepresentation.

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Definitions:

Terms Of Sale

Conditions agreed upon by the buyer and seller covering payment, delivery, and warranties, which define the responsibilities of each party in a transaction.

Inventory

The raw materials, work-in-process products, and finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.

Credit

The ability of a borrower to obtain funds from a lender under agreed conditions.

Required Rate

The minimum return that investors expect to earn from an investment, determining the value of an investment.