Sara visited Ben's, a famous designer jewelry store, to buy herself a necklace. She browsed through the store's product catalogue and chose a particular model of diamond necklace. After she chose it, the manager at Ben's sent an order to the manufacturer to make the necklace. Which of the following statements is true at this point in the scenario?
A) The necklace is an identified good.
B) Ben's holds the title to the diamond necklace.
C) Only a contract to sell has been made between Sara and Ben's.
D)The title to the necklace will pass to Sara as soon as the necklace is made.

The answer is C.

Explanation:

A Contract to Sell is simply an agreement between a seller and a buyer. This contract shows that the seller has promised to sell a commodity to the buyer at a set price and the buyer has also promised the seller that he/she will buy the commodity at the set price.

After signing the contract, ownership of the commodity is not immediately transferred to the buyer because payment has not been made.

If the buyer should default in payment, the seller has the right to withhold the commodity.

In the scenario offered above, we can see that Sara is yet to pay for the necklace, therefore, it is only a contract to sell that exists between Sara and the Manager.

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