Question

In: Operations Management

Describe warranty requirements and explain the three common types of warranties. If your purchase does not...

Describe warranty requirements and explain the three common types of warranties.

If your purchase does not come with a written warranty, is it still covered by an implied warranty? What if the product is marked “as is”? Do all states permit “as is” sales?

Describe what product liability means and explain negligence and misrepresentation.

Describe strict product liability and company liability. Please provide a company example pertaining to product liability.

Solutions

Expert Solution

The basic requirements for warranty are:

-Who can use the warranty

-goods covered in warranty

-nature of warranty

-duration of warranty

-process of initiating a claim
The types of warranty are:

1.Legal warranty that is applied automatically by consumer protection act when you purchase an item.

2. Basic warranty that is also free and given by the seller of the product.

3. Additional warranty that is purchased by the ecustomer for additional services and maintnance of product.

If your purchase does not come with a written warranty, it is still covered by implied warranties unless the product is marked "as is," or the seller otherwise indicates in writing that no warranty is given. All states do not permit "as is" including Kansas, Maine, Maryland, Massachusetts, Mississippi, Vermont, West Virginia, and the District of Columbia.

Product liability is when a manufacturer or seller sells a product that is defective, thus the manufacturer or seller are held liable.Negligence and misinterpretation means the warranty is void due to defectiveness in the product.

Strict product liability is a legal rule that says a seller, distributor or manufacturer of a defective product is liable to a person injured by that product regardless of whether the defendant did everything possible to make sure the defect never happened. Company liability is same as strict product liability.

Real case example of product liability:"Vehicles using gas powered engines require coolant to prevent overheating in the summer and freezing up in the winter. A lawsuit against General Motors stated the coolant in vehicle engines contained a dangerous chemical. GM had to pay out around $20 billion for its 25 million customers. Each person ended up receiving from $400 to $800."


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