When the Security Interest Is Perfected and the Buyer Knows

question 47

Multiple Choice

When the security interest is perfected and the buyer knows of its existence, a buyer in the ordinary course of business:

• A) is subject to the security interest created by his seller.
• B) takes the purchase free from a security interest created by his seller.
• C) takes the purchase free from a security interest only if the person is buying farm products from a person engaged in a farming operation.
• D) is not protected if the dealership is in default of its loan agreement.

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Definitions:

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