A clothing store has opened a credit account in which Judy, a college student, gets Alice, her older sister, to agree to pay the amount owed on the account if Judy fails to do so. Which of the following statements is true of this scenario?
A) Judy is the obligor, and she is secondarily liable to the clothing store.
B) Alice is the guarantor, and she is primarily liable to make the payments.
C) Judy is the obligor, and she is contractually liable to the guarantor.
D) Alice is the guarantor, and Alice's contract must be in writing to be enforceable.

Question

Quizplus · Accepted Answer

A third person (the guarantor) agrees to perform the contractual duties another person (the obligor) owes under another contract, if the obligor does not perform. The person to whom the obligor and the guarantor are contractually liable is called the obligee. Alice is the guarantor and her contract must be in writing to be enforceable.

A Clothing Store Has Opened a Credit Account in Which