Colorado Car Sales Practice Test

Which statement is true about dealer demo plates?

1. They can be used only on private vehicles

2. They may be used on commercial vehicles owned by the dealership

3. They are only valid for personal vehicles

4. They cannot be transferred between vehicles

The correct answer is: They may be used on commercial vehicles owned by the dealership

Dealer demo plates are specifically designed to allow dealerships to showcase their vehicles, including commercial vehicles, for purposes such as test drives or demonstrations. This allows potential buyers to experience the vehicle in a realistic setting, which can help facilitate sales. Using demo plates on commercial vehicles owned by the dealership is acceptable because these vehicles are part of the dealership's inventory. The purpose of these plates is to promote and facilitate sales, hence they are applicable to various types of vehicles that a dealership may offer. Options that refer to restrictions on the use of demo plates for private or personal vehicles do not encapsulate the broader applicability of these plates across the dealership's inventory, which includes both personal and commercial vehicles. Additionally, the notion that demo plates cannot be transferred between vehicles is inaccurate; they are designed to be moved among the cars in a dealership's active inventory, allowing flexibility in how vehicles are demonstrated to potential customers.