chapter 15

Describe the steps of the consumer complaint process.

- Contact the place of purchase -Contact the company headquarters -Involve a consumer agency -Take legal action

Fraud -

occurs when ci=onsumers are given false information in an effort to make a sale

Arbitration-

results in a decision that is legally binding.

IMPULSE BUYING-

the opposite of spending time and effort, buying too quickly.

True or False. An implied warranty is usually printed in the owner's manual of a product.

false

True or False. The U.S. Consumer Product Safety Commission is responsible for regulating the safety of food.

false

If a person returns an item as new for a refund after using it, this violates the consumer responsibility to be

honest

THE FIRST STEP IN THE BUYING DECISION-MAKING PROCESS IS TO

identify your needs

Implied warranty -

imposed by law and understood to apply even though it has not been stated. Not written.

Mediation-

involves the use of a third party who tries to resolve the complaint between the consumer and the business.

class action suit-

legal action by one party on behalf of a group of people who all have the same grievance.

Express warranty -

made orally or in writing and promises a specific quality of performance.

How does an express warranty differ from an implied warranty?

- An express warranty is made orally or in writing and promises a specific quality of performance. An implied warranty is imposed by law and is understood to apply even though it has not been stated.

A person who compares product information on labels is using the consumer right to

-be informed

How does mediation differ from arbitration?

Mediation involves the use of a third party who tries to resolve the complaint, while arbitration results in a decision that is legally binding on both parties in a dispute.

WHAT ARE THE MAIN SOURCES OF CONSUMER INFORMATION?-

Product testing organization Media sources Government agencies Business sources Personal contacts

THE MOST RELIABLE CONSUMER INFORMATION SOURCE WILL USUALLY BE

REPORTS FROM CONSUMER TESTING ORGANIZATIONS

Most consumer complaints are resolved by

Returning to the place of purchase

WHAT ARE THE MAIN CATEGORIES OF SHOPPING LOCATIONS?

Traditional retailers, Contemporary retailers, Non- store shopping

Explain legal actions available to assist consumers.

-Third party settlements- a third party may be used to settle consumer disputes. Mediation involves the use of a third party who tries to resolve the complaint between the consumer and the business. Arbitration results in a decision that is legally binding. -Class action suits- a legal action suit is legal action by one party on behalf of a group of people who all have the same grievance. In this type of lawsuit, one person or small group represents the interests of many others - Using a lawyer- if all else fails, a final step might be to hire a lawyer. Before using the services of a lawyer, you should ask various questions such as is the lawyer experienced, how will you be charged and when will you be required to pay.

What actions can be taken to be an involved consumer?

-You should be honest, reasonable and active and informed

WHAT DECISION-MAKING STEPS SHOULD BE TAKEN WHEN MAKING A PURCHASE?

1. Identify your needs and wants 2. Know the choice available 3.Determine your desire satisfaction 4.Evaluate alternatives 5. Make the decision

AHAM develops performance standards for appliances, such as refrigerators.

true

The unit price for a 12-ounce box of cereal that costs $2.39 is 20 cents.

true

A company refused to refund $10 to more than 4,000 customers. This situation might result in the use of

a class action suit

Describe consumer responsibilities.

- Be honest- those that are not honest cause prices to go up. Businesses make up prices from shoplifting by raising prices. - Be responsible- if you are not satisfied, you should complain in a responsible way. You should have a cause for a complaint. -Be active- you should report unethical business practices to prevent other consumers from becoming a victim. - Be informed- you must find and use the information available to you. Being an informed customer is hard work, but may make your dollars go as far as possible. -Be involved- you have the responsibility to participate in government, which starts by being an informed voter. Make your concerns known to government officials or consumer agencies. You should be a wise and efficient consumer (and to the government).

Match the government agency that would be most concerned with the following consumer problems.

-A skincare product that causes a serious rash. FDA -A company that is using unfair business practices to eliminate competition. FTC -A lesser-quality of beef that is advertised as "prime". USDA -infant seat with a handle that does not latch properly. CPSC -power plants releasing unsafe emissions into the air. epa

Explain seven consumer rights.

-The right to be informed- 1952 (Kennedy) -The right to safety- 1962 (Kennedy) - The right to choose- 1962 (Kennedy) -The right to be heard- 1962 ( Kennedy) -The right to remedy- 1969 (Nixon) -The right to consumer education- 1975 (Ford) - The right to service- 1994 (Clinton)

Explain the consumer movement.

Business taking advantage of the consumer. Therefore, the consumer movement started. Because of this movement, public and private agencies, police, laws, and regulations were developed to protect consumer interest.

small claims court-

a court system that exists to resolve cases involving small amounts. Disputes are resolved quickly and inexpensively.

BRAND-

a name given to a product or service to distinguish it from similar and competitive skills.

UNIT PRICE-

a price per unit of measure

Guarantee -

a promise by the manufacturer or dealer, usually in writing that a product is of a certain quality.

Consumer Movement -

to fight against unfair business practice, consumers united to demand fair treatment from business, giving rise to what is known as the consumer movement.

List common consumer concerns.

top 10 consumer complaints include: debt collection, auto sales, home repair and construction, credit cards, internet goods and services, predatory lending and mortgages, telemarketing, auto repair, auto warranties.