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Exam 22: Consumer Protection

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Question 1

True/False

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Merchants must ship orders within the time promised in their ads. 

A) True
B) False

Correct Answer

verified

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Question 2

Multiple Choice

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Cecilia borrows $20,000 from Debit &Credit Union to repair her home and to buy a car.She buys a laptop from eStuf Store in a transaction financed by the seller.If these parties are subject to the Truth-in-Lending Act,Regulation Z applies to 

A)  ​the car loan only. 
B)  ​the home repair loan only. 
C)  ​the retail installment sale only. 
D)  ​the car loan, the home repair loan, and the retail installment sale.

E) A) and B)
F) A) and D)

Correct Answer

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D

Question 3

True/False

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Federal laws often provide more sweeping and significant protections for the consumer than state laws. 

Drugs can be test-marketed to the public before they are ensured to be safe and effective. 

Elise and many other consumers complain to the Federal Trade Commission (FTC) that a Faux Diamonds Company ad is deceptive.The FTC's first step is to 

Corner Market sells groceries.Delta Food & Drug Store sells groceries and fills prescriptions.The party with the chief responsibility to prevent unsafe food and drugs from being sold is 

Puffery constitutes deceptive advertising. 

A sanction known as bait-and-switch advertising requires a company to advertise the products of its competitor to counter its own false claims. 

Vague generalities and obvious exaggerations are permissible in advertising. 

A credit-cardholder is liable for all unauthorized charges made before the creditor is notified that the card has been lost.

Quik Collection Agency calls Pat several times a day,and some-times in the middle of the night,about an overdue bill that Regal Sporting Goods turned over to Quik for collection.This is a violation of 

Slow-Brew Coffee Company sells coffee and related beverages.The company's ad contends that ambitious businesspersons "Drink Us & Rise Up in the World!' " The Federal Trade Com-mission would consider this ad to be 

The Food and Drug Administration must ensure the safety of new drugs. 

In its ads,Crunchy Inc.makes various claims about its snack products.Crunchy's advertising claims would most likely be deemed deceptive if the claims 

A debt-collection agency is someone who regularly attempts to collect debts on behalf of someone else,usually for a percentage of the amount owed. 

Under federal law,the calorie content of the food on a menu must be posted by Organic Mix,LLC,if Organic Mix is 

Food products are required to bear labels detailing the nutritional content. 

Wild Things,Inc.(WTI) ,in its ads,makes claims about its products that are obvious exaggerations and claims that are false but appear to be true.WTI may be subject to sanctions for​ 

Hearth & Home Furniture store advertises bedroom suites at a "Special Low Price of $599." When Ilene tries to buy one of the suites,Jill,the salesperson,tells her that they are all sold and no more are obtainable.Jill adds that Hearth & Home has other bedroom suites available for as low as $2,599.This is 

An information label must be attached to every new car to include the fuel economy estimate for the vehicle.