If the Car Is Really Worth Only $500,what Is the Effect

question 62

Multiple Choice

If the car is really worth only $500,what is the effect of this lower vehicle value on the contract between Jennifer and Timmy?

• A)The contract is voided because an illusory promise was made by Jennifer based on the illusion that the car was worth more.
• B)Promissory estoppel results in the contract being voided because Timmy's promise was based on inaccurate information.
• C)There is no effect,because the court does not determine if a good or bad deal was made.
• D)The court may award Timmy damages because Jennifer entered into a contract under false pretenses and cost him money.
• E)The effect of the lower vehicle value will depend upon whether the court determines if Timmy entered into a bad or good deal.

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Definitions:

General Electric

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Plant Size

The scale or capacity of a factory or production facility, often measured in terms of productive capability or physical dimensions.

Diseconomies of Scale

An economic concept where increasing production results in higher per unit costs.

Long-run Average Total Cost

The average cost per unit of output over the long term, where all inputs are considered variable, allowing firms to adjust all factors of production.