Future Business Leaders of America (FBLA) Business Law Practice Exam

What is a guarantee of quality that is imposed by law called?

1. Express warranty

2. Implied warranty

3. Negotiated warranty

4. Contractual warranty

The correct answer is: Implied warranty

The concept being referred to in this question is known as an implied warranty. An implied warranty is a legal guarantee that exists automatically by law, rather than being explicitly stated in a contract or agreement. This type of warranty assures consumers that the goods or services provided will meet certain standards of quality and reliability, even if the seller does not specifically mention those standards. For example, when a consumer purchases a product, there is generally an implied warranty that the product is fit for its intended purpose and that it will function as expected. This legal protection exists to ensure that consumers are not misled or taken advantage of and that they can have confidence in the products they purchase. In contrast, express warranties are explicitly stated by the seller, either in writing or verbally, outlining specific promises about the quality or features of a product. Negotiated and contractual warranties are less common terms; a negotiated warranty might imply negotiations took place for specific conditions, while a contractual warranty generally relates to guarantees outlined in a formal contract but does not carry the same automatic legal weight as an implied warranty. Thus, the correct answer reflects the automatic protections consumers enjoy under the law related to product quality.