Define and explain the theory behind the economic loss rule
The economic loss rule bars a plaintiff who is in privity of contract with the defendant or who has entered into a commercial transaction involving the defendant from bringing a lawsuit for negligence based solely on economic losses (as distinct from damages resulting from personal injury or property damage). The theory is that parties who could have bargained for contractual protections, such as an express warranty, should be relegated to the remedies available under commercial law and not afforded tort remedies designed for accidents that cause property damage or personal injury.
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When attempting to identify the economic characteristics of the industry in which a particular firm participates an analyst might ask which of the following questions?
a. Does technological change play an important role in the firm maintaining a competitive advantage? b. Has the firm diversified across several geographic markets? c. Has the firm recognized revenues at the proper time? d. Has the firm structured transactions to make it look more profitable than economic conditions suggest?
Which of the following was the top consumer fraud in number of victims identified in the U S Federal Trade Commission report?
a. foreign lottery scams b. advance fee loan scams c. fraudulent weight-loss products d. credit card insurance
A company purchased equipment valued at $66,000. It traded in old equipment for a $9,000 trade-in allowance and the company paid $57,000 cash with the trade-in. The old equipment cost $44,000 and had accumulated depreciation of $36,000. This transaction has commercial substance. What is the recorded value of the new equipment?
A. $65,000. B. $9,000. C. $8,000. D. $66,000. E. $57,000.
Dr. Roth is a general practitioner in rural Ontario who has misdiagnosed cancer. A cancer specialist a year later properly diagnosed it. The patient sues Dr
Roth, claiming that if the cancer had been properly diagnosed a year earlier, it could have been cured or arrested. In determining whether Dr. Roth has breached the standard of care required, the court will apply the standard of: A) The reasonable person. B) The reasonable rural Ontario doctor C) The most careful Canadian doctor. D) The reasonable urban doctor E) The average cancer specialist.