BLAW ch 20
Under federal law, the calorie content of the food on a menu must be posted by Organic Mix, LLC, if Organic Mix is a. a restaurant chain with twenty or more locations. b. a food distributor with twenty or more customers. c. a food processor with twenty or more products. d. a food producer with twenty or more acres.
a
Bagels n' Pastries, Inc., makes and sells a variety of bread products. Bagels n' Pastries's product packages must include a. the company owner's identity. b. the contents' net quantity. c. the restaurants and stores in which the product is sold. d. the type of consumer most likely interested in the product.
b
Cleaners & Solvents, Inc. (CSI), engages in deceptive advertising when it markets its product Dirt Remover as able to kill germs over long periods of time. In an action against CSI regarding Dirt Remover, the firm is ordered to stop its false advertising of Dirt Remover and other products. This is a. a counteradvertising order. b. a multiple product order. c. a "cooling-off" law. d. a validation notice.
b
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 a. draft a formal complaint. b. investigate. c. issue a cease-and-desist order. d. order restitution.
b
In the ordinary course of business, Loan2Buy Corporation offers credit to Mai and other consumers and reports on the loans to credit agencies. To save time and money, Loan2Buy generally does not correct or update its reported information. This is most likely to result in a. a levy of a nominal fine. b. an assessment of damages. c. an order of rescission of the loan contracts. d. no sanctions.
b
Mouth & Gums, Inc. (CSI), engages in deceptive advertising when it markets its product Oral Rinse as able to kill germs over long periods of time. In an action against Mouth & Gums, the firm is ordered to stop its false advertising of Oral Rinse and other products. This is a. a counteradvertising order. b. a multiple product order. c. a "cooling-off" law. d. a validation notice.
b
Spicy Salsa, Inc., complains to the Federal Trade Commission (FTC) about an ad broadcast by Tangy Taco Sauce Company, Spicy Salsa's competitor. The FTC investigates and concludes that the ad is deceptive. The FTC's next step is to a. conduct negotiations between the competitors. b. draft a formal complaint. c. issue a cease-and-desist order. d. permit Spicy Salsa to broadcast similarly deceptive counteradvertising.
b
Logan's application to Metro Bank for a credit card is denied. Logan can obtain information on his credit history in a credit agency's files under a. no federal law. b. the Equal Credit Opportunity Act. c. the Fair Credit Reporting Act. d. the Fair Debt Collection Practices Act.1
c
Medi-Insurance Company faxes ads to Nancy and other individual consumers without the recipients' permission. This is subject to a. a cease-and-desist order by the Federal Trade Commission. b. no sanctions. c. possible fines by the Federal Communications Commission. d. rescission on the order of the Federal Reserve Board.
c
. Soundbites Corporation makes and markets cellphones. Soundbites's ad states that on its phones voices and text come through as "clear as the sky on a cloudless day." The Federal Trade Com-mission would consider this claim a. false and misleading. b. impermissibly vague and general. c. a deceptive half-truth. d. none of the choices.
d
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.
d
Grover signs an installment contract with Home Appliance Store to finance the purchase of new kitchen appliances—stove, refrigerator, dishwasher, microwave, and toasteroven—for $3,999. This transaction is subject to a. no federal law. b. the Fair Credit Reporting Act. c. the Telecommunications Act. d. the Truth-in-Lending Act.
d
Jasmine receives an unsolicited credit card in the mail and tosses it on her desk. Without Jasmine's permission, her roommate Ilene uses the card to buy a new tablet for $500. Jasmine is a. liable for $500. b. liable for $250. c. liable for $50. d. not liable for any amount.
d
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 Commission would consider this ad to be a. false and misleading. b. impermissibly vague and general. c. a deceptive half-truth. d. none of the choices.
d
SmartPhone Company's ad states that its product is "The Best that Money Can Buy." Because of this ad, the Federal Trade Commission is most likely to issue a. cease-and-desist order. b. counteradvertising order. c. multiple product order. d. none of the choices.
d
Teri borrows $10,000 from USA National Bank to remodel a room in her home. This transaction is subject to a. no federal law. b. the Consumer Leasing Act. c. the Consumer Product Safety Act. d. the Truth-in-Lending Act.
d
Tory borrows $10,000 from USA National Bank to remodel a room in her home. This transaction is subject to a. no federal law. b. the Consumer Leasing Act. c. the Consumer Product Safety Act. d. the Truth-in-Lending Act.
d
A collection agency must include a validation notice whenever a debtor pays a debt.
false
A credit-cardholder is liable for all unauthorized charges made before the creditor is notified that the card has been lost.
false
A sanction known as bait-and-switch advertising requires a company to advertise the products of its competitor to counter its own false claims.
false
Advertising that contains an endorsement by a celebrity will not be deemed deceptive.
false
Drugs can be test-marketed to the public before they are ensured to be safe and effective.
false
Federal laws often provide more sweeping and significant protections for the consumer than state laws.
false
Labels on fresh meats are not required to indicate where the food originated
false
Major credit reporting agencies must provide consumers with free copies of their own credit reports every six months.
false
Puffery constitutes deceptive advertising.
false
State consumer protection agencies are charged by Congress with the broadly stated goal of preventing unfair and deceptive trade practices.
false
The Consumer Product Safety Commission is the primary agency that issues regulations on food labeling.
false
The Federal Reserve Board of Governors has issued a regulation that governs credit provisions associated with sales contracts—Regulation Z.
false
The Food and Drug Administration does not have the authority to directly recall any food products that it suspects are tainted but must rely on the producers to recall items.
false
A consumer who receives unsolicited merchandise sent by U.S. mail can keep it without obligation to the sender.
true
A sanction known as counteradvertising requires a company to advertise anew to inform the public about earlier misinformation.
true
Advertising that appears to be based on factual evidence will not be deemed deceptive even if it is not reasonably supported by evidence.
true
An information label must be attached to every new car to include the fuel economy estimate for the vehicle.
true
Insurance companies must spend at least 85 percent of all premium dollars from large employers on benefits and quality improvements.
true
Labels on fresh vegetables must indicate where the food originated.
true
Manufacturers are required to report on any products intended for sale if the products have proved to be hazardous.
true
Merchants must issue a refund within a specified period of time when a consumer cancels an order.
true
Restaurants must post guidelines on the number of calories that an average person requires daily
true
The Consumer Product Safety Commission conducts research on the safety of individual consumer products and maintains a clearinghouse on the risks associated with various products.
true
The Fair Debt Collection Practices Act generally applies only to debt-collection agencies that regularly attempt to collect debts on someone else's behalf.
true
Vague generalities and obvious exaggerations are permissible in advertising.
true
