Question

Under hire-purchase system, who has the right of selling?
(a). Hirer
(b). Buyer
(c). Debtor
(d). Hire vendor

Answer 1

Hint: In this question, we are asked about the hire-purchase system and the person to whom the right to sell is assigned. Therefore, we should understand the hire-purchase system and then choose the appropriate answers from the options given in the question.

Complete answer:
In a hire-purchase system, the customer pays an initial instalment and can use the product from that time by paying a fixed amount of instalment at a specified installment till the whole price as agreed in the contract is paid off. Only after the full payment has been made, the ownership rights are transferred to the customer. Till then, the ownership rights and hence the right to sell remains with the original owner of the item or the hiring vendor.
In the options, the hirer, buyer refers to the customer and also debtor does not refer to the original owner. Therefore, the correct answer to this question should be option (d) which is the hire vendor.

Note: We have to be careful with the terms referring to the owner and the customer in a hire-purchase system in order to answer this question. Also, we should know which terms may be alternatively used for the original owner and customer in this system.