Chapter 6 Consumers

T or F: "Weasel words" are words used to evade or retreat from a direct or forthright statement.

True

Legal Paternalism is the doctrine that the law

may justifiably restrict the freedom of the individual for his or her own good.

The case of MacPherson v. Buick Motor Car in 1916 changed product liability law. As a result of it, the courts

permitted consumers to sue manufacture with whom they had no contractual relationship

The terms "best, finest, and most, are examples of

puffery

Advertising

subsidizes the media

In 1972 Congress created one of the most important agencies for regulating product safety. This agency is the

Consumer Product Safety Commission

T or F: Deceptive advertising is always legal because we have freedom of speech

False

T or F: In his books the Affluent Society and The New Industrial State, John Kenneth Galbraith argues that consumer wants are never created by advertising or sophisticated sales strategies

False

T or F: Legal paternalism is the doctrine that the law should not be used to restrict the freedom of individuals for their own good.

False

T or F: Puffery is illegal

False

T or F: Strict liability is the same thing as absolute liability

False

T or F: The doctrine of caveat emptor means that the law may be justifiably used to restrict the freedom of individuals for their own good.

False

Which of the following is an example of price gouging?

New York hotels that doubled or tripled their prices in the aftermath of the September 11, 2001 attacks.

Which statement is accurate in its description of consumer protection?

The Consumer Product Safety Commission has the power to order recalls

T or F: Defenders of advertising claim that, despite criticisms, advertising enjoys protection under the first Amendment as a form of speech.

True

T or F: Strict product liability is the doctrine that the seller of a product has legal responsibilities to compensate the user of that product for injuries suffered due to a defective aspect of the product, even if the seller has not been negligent in permitting that defect to exist

True

T or F: Subliminal advertising is advertising that supposedly communities at a level beneath our conscious awareness

True

T or F: The Federal Trade Commission (FTC) was established in 1914 to protect consumers against deceptive advertising

True

According to the legal doctrine of strict product liability

a manufacturer need not be negligent to be held liable for a defective product

Critics of advertising generally agree that

advertising rarely gives consumers much useful information

Terms like "can be", "as much as", and "help," are examples of

ambiguity

Harvard business professor Theodore Levitt has

drawn an analogy between advertising and art

"Puffery" is an example of which of the following deceptive or misleading advertising techniques

exaggeration

People generally speak of two kinds of warranties. What are those two kinds of warranties

express and implied

According to Galbraith's "dependence effect,"

producers use advertising to shape consumer wants

The goal of advertising is

to persuade people to purchase the product