What must be established in order for goods to be considered merchantable under the UCC?
To be merchantable under the UCC, goods must (1) pass without objection in the trade under the contract description; (2) be fit for the ordinary purposes for which such goods are used; (3) be within the variations permitted by the agreement and be of even kind, quality, and quantity within each unit and among all units involved; (4) be adequately contained, packaged, and labeled as the agreement may require; and (5) conform to the promises or affirmations of fact made on the container or label, if any. Fungible goods, such as grain, must be of average quality within the contract description.
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Proportion Defective Probability of Acceptance 0.01 0.98 0.02 0.95 0.03 0.90 0.04 0.74 0.05 0.41 0.06 0.15 Today the company making the purchase receives two lots of 2,000 items and the inspection department is in a big hurry. Which action will result in an identical AOQL for the purchasing company? A) Take a random sample of 25 from each lot and accept or reject both lots based on the results. B) Take a random sample of 50 from one lot and accept or reject the second lot based on the first lot's results. C) Take a random sample of 100 from one lot and accept or reject the second lot based on the first lot's results. D) Take a random sample of 50 from each lot and accept or reject each lot based on the results.