[startupcfo]

Page 72 of REG textbook suggests that a MERCHANT is held to a higher standard of fairness. The logic is that they have an advantage of expertise, so they are required to be make deals that have commercial reasonableness.

1. Let’s say a slimy used car dealer knows the market value of of a used Toyota Camry is $20,000. He puts a sticker price of $22,000 knowing that many Americans would offer to negotiate and he is in fact willing to sell for 20K. A sucker walks on the lot and the car dealer convinces him that $22K is a fair price. Is this sale not enforceable because a merchant is taking advantage of an individual consumer?

2. The branch manager at Home Depot has a bunch of washing machines with a normal vendor price of $500. Everyone in the industry knows these prices from history. He manages to convince the branch manager at the nearby Lowes to take some extra washing machines off his inventory for $1200. Is this sale:

A) not enforceable because the branch manager is a merchant

B) enforceable because the fact pattern suggests this was supposed to be a dealing between two merchants that have expertise?

AUD - 93
BEC - 87
FAR - 77
REG - 77

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Corporate finance leader

BEC - 87 | 02/28
REG - 70 | 06/10, REMATCH | 08/30
AUD - XX | 09/10
FAR - XX | 12/10

[Anonymous]

startup IMO if your not trying to work the concepts in an actual question (versus hypotheticals) you're wasting precious mental energy.

[Author]

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