John, a Salesman for the Computer Division of B

question 123

Multiple Choice

John, a salesman for the computer division of B & C Machines Ltd., is meeting with a potential customer at 11:00 tomorrow morning. Because the customer does not have the funds to pay the full price of the system required, he wants to discuss chattel mortgages and conditional sales contracts. Which of the following is false with regard to these contracts?

• A) Both contracts are governed by the Personal Property Security Act.
• B) In both cases, the debtor is entitled to have the lien removed upon final payment.
• C) Only a conditional seller needs to register his interest for protection against third-party claims; a chattel mortgagee need not do so.
• D) If the seller of goods is willing to allow the buyer to pay by installments, he could use either a conditional sale contract or a chattel mortgage to obtain security for payment of the debt.
• E) Both contracts provide that the debtor has quiet possession of the goods given as security as long as he is not in default.

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Definitions:

Comparative Advantage

The ability of an individual or country to produce a particular good or service at a lower opportunity cost than others.

Broccoli

A green vegetable with a large flowering head that is eaten as a vegetable.

Pounds

A unit of currency used in the United Kingdom and other territories.

Comparative Advantage

An economic principle that refers to the ability of a party to produce a particular good or service at a lower opportunity cost than another.