Molly Goes to the Store and Buys a Toaster That

question 51

Multiple Choice

Molly goes to the store and buys a toaster that shocks her when she plugs it into the outlet.She returns it to the store and was told that the seller provided no warranties and that she would have to return it to the overseas manufacturer even if the postage to return it to the manufacturer would amount to more than the toaster is worth.Molly believes that is ridiculous.Who is correct under the UCC and why?

• A) Molly is correct because by selling the toaster, the seller made an implied warranty of merchantability.
• B) Molly is correct because by selling the toaster, the seller made an express warranty.
• C) Molly is correct because by selling the toaster, the seller made an implied warranty of fitness for a particular purpose.
• D) The seller is correct because only the manufacturer is responsible for warranties on consumer goods.
• E) The seller is correct because while the seller is responsible for warranties for consumer goods costing in excess of $500, only the manufacturer is responsible for lower-priced consumer goods.

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Definitions:

Yield To Maturity

The total return anticipated on a bond if it is held until its maturity date, considering all interest payments and the principal repayment.

Par

The face value of a bond or other security, at which it can be redeemed at maturity or the amount of money equal in value to a particular share or bond.

Coupon

The yearly payment of interest to those holding bonds, represented as a percentage of the bond's nominal value.

Semi-Annual Coupon

A bond payment made to bondholders twice a year, representing interest on the bond's face value.