Colorado Car Sales Practice Test

What is not a valid reason for a license denial of a motor vehicle dealer?

1. Employing a properly licensed salesperson

2. Failure to provide adequate customer service

3. Having prior disciplinary actions

4. False reporting of sales

The correct answer is: Employing a properly licensed salesperson

Employing a properly licensed salesperson is a practice that supports compliance with regulatory standards in the motor vehicle industry. Having a licensed salesperson on staff indicates that the dealer is following legal requirements, which is essential for maintaining a good standing within the industry. In contrast, the other choices provide valid reasons for license denial. Failure to provide adequate customer service can reflect poorly on the dealership's operations and customer satisfaction, impacting its reputation and possibly leading to license issues. Having prior disciplinary actions suggests a history of non-compliance or unethical conduct, which can be a significant factor in license considerations. False reporting of sales is a serious offense that undermines the integrity of the dealership and the trust of its customers, thus serving as a valid reason for denial as well.