Marketing Chapter 6

A credit card company offers an annual percentage rate of 21 percent. The balance on your credit card is $1,000, and the minimum payment due is $100. If you make the minimum payment, what will the balance on your credit card be the next month, assuming you did not make any new purchases?

$915.75

If the local recycling plant pays $0.10 per pound for aluminum cans, how many pounds of cans would it take to get $25?

250

The Truth in Lending legislation requires banks and other lending institutions to clearly disclose their annual interest rates. If the monthly interest rate on an outstanding credit card is 2.5 percent, what is the annual interest rate?

30%

Stealing by employees is a big problem in retail chain stores. One company solved the problem with an employee-education program. Inventory loss through theft declined steadily over the next six months. Management wants to present the results of the program at a board meeting. Identify the type of graph that would be most effective in showing this decline and explain why.

A line graph would be most effective, as you could track down the amount of goods stolen in each month. This would help you track your goal, and see your periodic progress over time.

What is the Sarbanes-Oxley Act?

Addresses accounting and proper reporting of a corporation's financial situation.

How is the use of price gouging connected to antitrust concerns?

Because when companies price necessary products at too high a price, then it becomes an ethical issue, and wonder why the products are so expensive, making them no longer trust the company. and thus is connected to antitrust concerns.

What are some benefits socially responsible companies might give employees? Why?

Breaks, free-to-use facilities, flextime, on-site child care, maternal leave etc.

Compare and contrast the roles of the three bureaus run by the Federal Trade Commission.

Bureau of Consumer Protection - responsible for enforcing consumer protection laws and trade regulation rules. Bureau of Competition - prevention of anticompetitive mergers and business practices. Bureau of Economics - studies the impact of its actions on consumers and report its findings to Congress, to the executive branch, and regulation.

Define business ethics.

Business ethics is the study of proper business policies and practices regarding potentially controversial issues, such as corporate governance, insider trading, bribery, discrimination, corporate social responsibility and fiduciary responsibilities.

Describe how businesses demonstrate social responsibility in the marketplace and in the community.

Businesses demonstrate social responsibility in the marketplace and in the community in many different ways. They demonstrate it in the marketplace by saving leftover money earned from sales, and using that to give employees more benefits. They respond to consumer concerns, and contribute money to the cause. This in turn, makes them feel happier, and make them want to work more. They also demonstrate it in the community by donating to charities, and other nonprofit organizations.

Which government agency is responsible for overseeing the safety of toys?

Consumer Product and Safety Commission

Explain two things socially responsible companies are doing to protect the environment?

Disposing of hazardous waste properly, and reducing amounts of air pollution from factories.

Why are employee benefits that demonstrate social responsibility helpful for businesses and their employees?

Employee benefits that demonstrate social responsibility are helpful to both businesses and employees. It is beneficial to businesses because this encourages the employees to keep working for that business or company. Likewise, employees also benefit from social responsibility as they get many benefits, and bonuses to their jobs, thus they will want to keep working, because they are happy where they work. People won't quit their jobs, either.

Research the Privacy Act and identify who must comply with the law. Evaluate whether you must comply with it. If you do not have to comply with the law, think of instances when privacy is an ethical issue. Explain.

Everyone must comply with the law due to the Research and Privacy Act, because they are law-abiding citizens. Any workarounds, or loopholes, could possible result in my company looking unethical, which in turn would damage my company's and my personal reputation. If you collect information about others, then you will have to comply with the Research and Privacy Act.

What are the three branches of the U.S. government and what does each include?

Executive - each administrator has an impact on the business, inspection,grading, and certification. Legislative - members of Congress debate and vote on bills and laws. Judicial - interpret and administer the laws.

The Better Business Bureau is a government agency. True or False?

False

What trends in the modern workplace affects the business world?

Home offices, flextime, family leave.

The Consumer Bill of Rights was established by ________

JKF

What is the chain of events that might result from a company's decision to offer its employees flextime and telecommuting?

Offering flextime and telecommuting increases the productivity of the workers. Which in turn generates more revenue for your company, which gives you a good reputation.

Explain what the Consumer Product Safety Commission (CPSC) does?

Oversees the safety of products such as toys, electronics, and household furniture.

What are the responsibilities of the Environmental Protection Agency (EPA)?

Protects human health and our environment. Monitor and reduce air pollution, and oversees recycling and hazardous waste disposal.

Identify five roles the government plays in a private enterprise system.

Provider of Services, Customers, Regulators, Enforcers of Private Enterprise, and Monitors of the Economy.

Research the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act of 2009. Explain its main principles. Note the requirements necessary for young people who wish to carry their own credit cards. Include your opinion about the marketing and distribution of credit cards to teenagers and young adults. How would you have liked the law to read for teenagers? Defend your ideas objectively.

The Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009 is a federal statute passed by the United States Congress and signed by U.S. President Barack Obama on May 22, 2009. It is comprehensive credit card reform legislation that aims "...to establish fair and transparent practices relating to the extension of credit under an open end consumer credit plan, and for other purposes." The bill was passed with bipartisan support by both the House of Representatives and the Senate. You must be over 18 years old, or have consent from your parent/guardian. If so, then they have to ask for the credit card under their account, and then give you your own. Or you can open something such as a high school checking account that will allow you to use a debit card instead of credit. I honestly don't mind the law as it is. I think that it's wise to make it so that you need parental consent before being able to use the credit card as a teenager. This way, young kids won't accidentally dig a hole of debt for themselves as the years progress, and learn to spend in moderation.

Describe how antitrust laws promote healthy competition in a private enterprise system.

The prevent any anticompetitive mergers and business practices. So there's competition between companies. Some examples would be: FTC Act, Sherman-Antitrust Act, Hart-Scott-Rodino Amendment to the Clayton Act, and the Robinson-Patman Act.

How closely should the government monitor food production?

The should monitor food production very closely, because if contaminated food enters our stores, then when people buy them, they will become very sick. This will make more people take off from work, and this will lower the productivity of the entire country.

Why is it important for the Federal Reserve to regulate and enforce private enterprise?

They have to regulate and enforce private enterprise, because they have to be able to protect consumers from unfair or deceptive business practices. And allow companies to compete and succeed, and to avoid monopolies.

Why is it important for businesses to be proactive about ethical practices?

They need to be proactive in their ethical practices, in order to give their company a good reputation. And to let their consumers know that they are reliable.

How do federal regulatory agencies protect consumers, workers, investors, and the environment?

They protect consumers with the Food and Drug Administration (FDA) and the Consumer Safety Commission (CPSC) is responsible for overlooking toys. Bureau of Economics also protects them. They protect workers with the Equal Employment Opportunity Commission (EEOC), and the OccupationaL Safety and Health Administration (OSHA). They protect investors with the Securities and Exchange Commission (SEC). They protect the environment with the Environmental Protection Agency (EPA).

What if one of the laws or ethical practices described in this chapter did not exist? How would this absence affect marketing?

This absence would hugely affect marketing, because then some things would not be illegal, and companies would get away with what is crime today. Also, if flextime didn't exist, then workers wouldn't work as hard. Or if price gouging didn't exist, then there would be unreasonably high prices for necessary goods.

Are you a whistle blower if you know your employer is doing something illegal or unethical? Explain your decision objectively.

You're not a whistleblower, because you are not informing the proper authorities, about your recent discovery, and you can still get in trouble if you don't say anything.