Question 1

Promises of fact made during the bargaining process are express warranties.

Accepted Answer

A) True 
 B)False

Question 2

Owen and Pablo enter into a contract for a sale of fifty Western saddles. Pablo pays,but Owen does not deliver. Pablo can normally recover as damages the difference between

Accepted Answer

A) any loss avoided and any profit gained. 
B) the actual price and the hoped-for price. 
C) the contract price and the market price. 
D) the current prices in the parties' locations. 
A) any loss avoided and any profit gained. 
B) the actual price and the hoped-for price. 
C) the contract price and the market price. 
D) the current prices in the parties' locations.

Question 3

To be merchantable,goods must be at least average,fair,or medium-grade quality.

Accepted Answer

A) True 
 B)False

Question 4

In the absence of any specific agreements,the buyer or lessee must make payment after receipt of the goods.

Accepted Answer

A) True 
 B)False

Question 5

Daily Bread Bakeries,Inc.,contracts to buy all of its ingredient requirements for bread making,at a certain minimum per year,from Enriched Flour & Grain Corporation for six years. After three years,Daily Bread tells Enriched that it plans to sell its assets to Flat Bread Shops,Inc. Flat Bread refuses to assure Enriched that it will continue Daily Bread's contract.
-Refer to Fact Pattern 22-1. Enriched can

Accepted Answer

A) assign its rights under the contract but cannot terminate it. 
B) terminate the contract and seek damages. 
C) suspend performance under the contract until Enriched is fully paid. 
D) do nothing. 
A) assign its rights under the contract but cannot terminate it. 
B) terminate the contract and seek damages. 
C) suspend performance under the contract until Enriched is fully paid. 
D) do nothing.

Question 6

Watercourse Pipe Company includes in its contracts a provision that reads,in large red letters,"There are no warranties that extend beyond the description on the face hereof." This disclaimer negates

Accepted Answer

A) the implied warranty of fitness for a particular purpose. 
B) the implied warranty of merchantability. 
C) the implied warranty of title. 
D) none of the choices. 
A) the implied warranty of fitness for a particular purpose. 
B) the implied warranty of merchantability. 
C) the implied warranty of title. 
D) none of the choices.

Question 7

Freddi buys bike shoes from Get n' Gear Store,telling the clerk that she wants the shoes to compete in High Pace Triathlon. The shoes break apart during the competition,caus-ing Freddi to be injured in a fall. Get n' Gear most likely breached

Accepted Answer

A) an express warranty. 
B) an implied warranty of fitness for a particular purpose. 
C) an implied warranty of merchantability. 
D) a warranty of title. 
A) an express warranty. 
B) an implied warranty of fitness for a particular purpose. 
C) an implied warranty of merchantability. 
D) a warranty of title.

Question 8

Vehicle Wholesale Company and Walt's Retail Motors enter into a contract for a sale of used cars. Vehicle Wholesale assures Walt's that it has valid title to the vehicles. Under the UCC,warranties of title arise

Accepted Answer

A) automatically in most sales contracts. 
B) only if the buyer asks for such a warranty. 
C) only if the seller expresses such a warranty. 
D) only in conjunction with lease contracts,not sales contracts. 
A) automatically in most sales contracts. 
B) only if the buyer asks for such a warranty. 
C) only if the seller expresses such a warranty. 
D) only in conjunction with lease contracts,not sales contracts.

Question 9

Refined Mills orders "Grade A" oats from Sweet Valley Farms to grind and sell to Town Co-op Grocery. Sweet Valley ships "Grade B" grain,which Refined Mills accepts. To recover damages for the nonconformity,Refined Mills must give notice of the breach within a reasonable time to

Accepted Answer

A) Sweet Valley. 
B) Town Co-op. 
C) no one. 
D) the appropriate state government agency. 
A) Sweet Valley. 
B) Town Co-op. 
C) no one. 
D) the appropriate state government agency.

Question 10

If goods in every respect conform to a contract,the buyer or lessee does not have a right to reject the goods.

Accepted Answer

A) True 
 B)False

Question 11

To specifically disclaim an implied warranty of fitness for a particular purpose,a seller or lessor must mention the word fitness.

Accepted Answer

A) True 
 B)False

Question 12

The principle of good faith applies to both parties to a sales contract.

Accepted Answer

A) True 
 B)False

Exam 22: Performance and Breach of Sales and Lease Contracts

Promises of fact made during the bargaining process are express warranties.

Owen and Pablo enter into a contract for a sale of fifty Western saddles. Pablo pays,but Owen does not deliver. Pablo can normally recover as damages the difference between

To be merchantable,goods must be at least average,fair,or medium-grade quality.

In the absence of any specific agreements,the buyer or lessee must make payment after receipt of the goods.

Watercourse Pipe Company includes in its contracts a provision that reads,in large red letters,"There are no warranties that extend beyond the description on the face hereof." This disclaimer negates

Freddi buys bike shoes from Get n' Gear Store,telling the clerk that she wants the shoes to compete in High Pace Triathlon. The shoes break apart during the competition,caus-ing Freddi to be injured in a fall. Get n' Gear most likely breached

Vehicle Wholesale Company and Walt's Retail Motors enter into a contract for a sale of used cars. Vehicle Wholesale assures Walt's that it has valid title to the vehicles. Under the UCC,warranties of title arise

Refined Mills orders "Grade A" oats from Sweet Valley Farms to grind and sell to Town Co-op Grocery. Sweet Valley ships "Grade B" grain,which Refined Mills accepts. To recover damages for the nonconformity,Refined Mills must give notice of the breach within a reasonable time to

If goods in every respect conform to a contract,the buyer or lessee does not have a right to reject the goods.

To specifically disclaim an implied warranty of fitness for a particular purpose,a seller or lessor must mention the word fitness.

The principle of good faith applies to both parties to a sales contract.

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