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45 DePaul L. Rev. 781 (1995-1996)
The Basis of the Bargain Requirement: A Market and Economic Based Analyis of Express Warranties - Getting What You Pay for and Paying for What You Get

handle is hein.journals/deplr45 and id is 793 raw text is: THE BASIS OF THE BARGAIN REQUIREMENT: A MARKET AND ECONOMIC BASED ANALYSIS OF EXPRESS WARRANTIES - GETTING WHAT YOU PAY FOR AND PAYING FOR WHAT YOU GET Thomas J. Holdych* Bruce D. Mann** TABLE OF CONTENTS I. Introduction .............................................. 782 II. Market Determination of Terms and Conditions ......... 786 A. Basic Operation of Markets for Complex Products . 788 B. Pricing the Complex Product ........................ 791 C. Warranties as Attributes ............................. 794 D. Warranties and Insurance Problems ................. 796 E. Warranties and Buyer's Inspection .................. 798 F. Warranties and Search Costs ........................ 800 III. Proposed Test for Express Warranties ................... 800 A. Terms Offered to the Market ....................... 802 B. Individually Negotiated Terms - Quasi-Market .... 803 C. Idiosyncratic Terms - Non-Market ................. 804 IV. Applying the Proposed Express Warranty Test .......... 804 A. Prepurchase Claims Made to the Market in G eneral ............................................. 805 B. Terms Not Seen Before the Sale .................... 809 1. Inexpensive or Repeat Purchase Products ....... 810 2. Expensive or Infrequently Purchased Products .. 810 3. Efficiency and Prepurchase Knowledge .......... 812 C. Warranties Contained in Express Contracts ......... 813 1. Standard Form Written Contracts ............... 814 2. Nonstandard Form Written and Oral Contracts . 816 D. Buyer Inspection or Use of Expert Opinion ........ 819 * Professor of Law, Seattle University. B.A., Rockford College, 1966; J.D., University of Illinois, 1970. ** Professor of Economics, University of Puget Sound. B.A., Economics, Antioch College, M.A.; Economics, 1969, Indiana University; Ph.D., Indiana University, 1974. The authors thank William Oltman, Sidney DeLong, Kellye Testy and Geoffrey Watson for reading a prior draft of this paper. We also thank Terri Farmer for her valuable research.

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