Neco 2018 Commerce Question 34

Practice objective / multiple choice question 34 from the 2018 Neco Commerce examination.

Neco 2018 Commerce Objective / Multiple Choice Hard Difficulty
Question 34 NECO • 2018 • COMMERCE • objective

A washing machine is advertised at \(\text{₦}85{,}000\). The contract states that a return within 30 days incurs a restocking fee of 12% of the purchase price plus a fixed administrative charge of \(\text{₦}3{,}500\). The Consumer Protection Act caps such fees at 8% of the purchase price plus a maximum fixed charge of \(\text{₦}2{,}000\). The consumer discovers a defect after 20 days and can either (i) return the machine and receive the refund after deductions, or (ii) keep the machine and receive a 5% goodwill discount on the purchase price. Which option gives the lower net outflow for the consumer, and does the restocking fee comply with the Act?

Answer Options

A. Return the machine; net outflow ₦14,200; the restocking fee exceeds the legal cap and is unlawful
B. Return the machine; net outflow ₦12,800; the restocking fee complies with the Act
Correct Answer C. Return the machine; net outflow ₦13,700; the restocking fee exceeds the legal cap and is unlawful
D. Keep the machine; net outflow ₦84,250; the restocking fee exceeds the legal cap and is unlawful
Correct Answer
C
Correct Option:
Return the machine; net outflow ₦13,700; the restocking fee exceeds the legal cap and is unlawful

About This Question

This is Neco 2018 Commerce Question 34. It is one of the objective questions from the 2018 Neco Commerce examination.

Difficulty level: Hard .

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