Which of the Following Statements About Misrepresentation Is Most Likely

question 34

Multiple Choice

Which of the following statements about misrepresentation is most likely true?

• A) When salespeople loosely describe their product or service in glowing terms, those statements can be relied upon by the potential buyer.
• B) Generally, the more knowledgeable the customer, the greater the chances the court will interpret an incorrect statement by a salesperson as an actionable misrepresentation.
• C) When a salesperson makes claims of a "factual nature" regarding a service's inherent capabilities, the law does not treat these comments as statements of fact and warranties.
• D) A salesperson's opinion about the quality of the product being sold is known as sales puffery and is legally actionable.
• E) Even if the salesperson misrepresentation statement is made innocently, many courts will award damages to the customer.

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Definitions:

Equivalent Units

A method used in process costing that converts partially completed goods into a number of completed units of output.

Assembly Department

An area in a manufacturing plant where parts are put together to create finished goods.

Conversion Costs

These are the costs required to convert raw materials into finished products, comprising labor and overhead expenses.

Materials Costs

Expenses incurred for materials that are directly associated with manufacturing a product.