Final answer:
The enforceability of credit sales made by a children's book store while its state license lapsed depends on state laws, but typically a lapse does not invalidate contracts.
The full faith and credit clause relates more to state recognition of legal actions, not transactions of an unlicensed business.
The Correct option is; No, states strictly enforce licensing requirements.
Step-by-step explanation:
The question of whether a children's book store can collect on credit sales made while its state license was lapsed revolves around the enforceability of contracts entered during that time.
According to general principles of contract law, the fact that a business has not paid a licensing fee does not necessarily invalidate contracts made during that period.
However, enforceability can depend on state laws regarding licensing. It is possible that some states may consider contracts made by an unlicensed business as unenforceable.
This is different from the full faith and credit clause under Article IV of the Constitution which primarily deals with interstate recognition of legal acts such as extradition, public acts, official records, and judicial proceedings, not necessarily the enforcement of contracts made by unlicensed businesses.
In essence, answer option (a) 'Yes, the contracts it made during the period of lapse are enforceable' could be true unless state law specifically states otherwise.
Businesses are generally expected to operate with a valid license, yet a lapse in licensing does not automatically mean that all transactions made within that period are void or unenforceable.
Answer option (d) 'Yes, all credit agreements are enforceable' is not accurate as there can be exceptions based on the nature of the agreement or compliance with specific regulations.