Question: Question 1 2 points Save Answer Fred contracts to buy a car from Lou. Prior to entering the contract, Fred asks Lou whether the car

Question 1 2 points Save Answer Fred contracts to buy a car from Lou. Prior to entering the contract, Fred asks Lou whether the car has ever been in an accident While Lou personally believes that the car may have been in an accident, he honestly does not know for sure and says it has not been in an accident. Fred notices that the car's hood is a different color than the rest of the car, the headlights do not match, and the front door does not close properly. Based on this evidence, Fred suspects that the car has been in one or more accidents. Nevertheless, he buys the car and later wants to rescind the contract. Which statement best describes this situation? There is no fraudulent misrepresentation since Fred cannot have justifiably relied on Lou's misrepresentation Fred can rescind the contract but cannot recover damages. There is fraudulent misrepresentation as a matter of law since Lou believed the car had been in an accident, and the contract can be rescinded. The observed damage to the car are latent detects that Lou had a duty to disclose

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