Tim Buys a High-Powered Tool from Binford Tools to Use

question 28

Multiple Choice

Tim buys a high-powered tool from Binford Tools to use on the construction of his own garage.Binford Tools provides a full warranty on the tool for the first six months.To pay for the tool,Tim signs a negotiable promissory note which contains the FTC Consumer Credit Notice.Binford properly negotiates the note to First Finance.Within three weeks,the tool stops working and Binford refuses to repair or replace it.In the meantime,First Finance demands payment from Tim.Under the Federal Trade Commission rules,this consumer credit situation means First Finance 

• A)can collect if it is a holder in due course.
• B)can collect if it is not a holder in due course.
• C)can collect whether or not it is a holder in due course.
• D)cannot collect.

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Definitions:

Crowdfunders

Individuals who financially support projects, causes, or businesses through crowdfunding platforms, often in exchange for rewards, equity, or nothing at all.

Equity

Ownership interest in a company or property, representing a share of the value after debts are subtracted.

Manufacture Prototypes

The process of creating early models or samples of a product to test its functionality, design, and feasibility.

Chinese Factories

Manufacturing facilities located in China, often noted for their high production capacity and cost-effectiveness.