Personal Finance Ch. 4 Test

In what oder should you purchase the following courses of action when you are dissatisfied with a purchase and suspect fraud? A. resort to dispute resolution B. take legal action C. return to the place of purchase D. get help from a consumer agency E. contact company headquarters

1. C 2. E 3. D 4. A 5. B

Calculate the unit price for a 24-ounce bag of candy that costs $3.20.

3.20 / 24 = $0.13

What is a legal aid society?

A network of community law affairs that provide free or low-cost legal assistance

Social factors obviously affected Fran's choice of backpack if the pack is A. a popular style B. well-made C. easily repaired D. reasonably priced

A. a popular style

An implied warranty guarantees that A. a product is fit for its intended use B. a defective product will be fixed C. only certain parts of a product are under warranty D. the distributor will replace a defective product

B. a defective product will be fixed

The settlement of a difference by a third party whose decision is legally binding is called A. mediation B. arbitration C. dispute resolution D. a class action

B. arbitration

Product labels for appliances generally include A. open dating B. efficiency ratings C. health claims D. unit pricing

B. efficiency ratings

Factors that might affect your purchase of a pair of running shoes?

Brand, if they qualify as running shoes, quality, store selection, need, income, price

A disagreement over an amount less than $500 is generally handled A. through a legal aid society B. in a class-action suit C. at small claims court D. by members of the American Bar Association

C. at small claims court

Direct selling includes all the following kinds of shopping except A. mail order B. telephone sales C. mall D. online

C. mall

When you are dissatisfied with a product and are seeking satisfaction, your last resort should be A. complaining at the original place of purchase B. getting help from a consumer agency C. taking legal action in small claims court D. using a dispute resolution program

C. taking legal action in small claims court

Compare the advantages and disadvantages of using cash instead of credit to purchase an expensive item.

Cash-avoid extra fees and regular payments like credit Disadvantages-money you spend is no longer available

Paul recently purchased a home in a newly built subdivision. He discovered that toxic waste from a nearby factory had seeped into his backyard soil and was killing his plants and the wild animals that visited his yard. He noticed the plants in his neighbors' yards were also dying. He has complained to the builder and factory manager, written to the corporate office of both, and tried to set up a dispute resolution, but the problem persists. What legal action would you recommend to Paul? Explain.

Class-action lawsuit There are most likely other people experiencing the same problem so a class-action lawsuit seems more reasonable. Plus, this damage seems to expense for a small claims court.

You would most likely negotiate the price for a(n) A. pair of jeans B. airline ticket C. tennis racket D. car

D. car

Before you begin to shop, you should A. decide to pay cash B. opt to delay payment C. identify your needs D. compare prices by visiting different stores

D. compare prices by different stores

Comparison shopping is a waste of time when buying an item such as A. a computer B. shampoo C. salt D. school supplies you often need to replace

D. salt

Five sources of product information that you might consult before making an expensive purchase?

Government agencies, internet, advertising, labeling, media, consumer reports, people you know

Whom can you call to find out about dispute resolution programs?

Local or state agencies, State attorney general office, small claims court, trade association, local bar assoc.

Imagine you are buying a new guitar. Describe how you would make the purchase.

Research before shopping for the product, look at alternatives of prices/brands/quality, make the best purchase, make sure there's no other costs or bills and also that you're satisfied.

Brian has $3,000 to spend on a laptop computer. He has narrowed his choices to the latest model with lots of speed and memory for $2,000 or a slower, discontinued model with half the memory for only $1,500. Which would you recommend he purchase? Why?

The higher quality one. If he can afford the better quality computer, then that's the better choice.

a legal action on behalf of all the people who have suffered the same injustice

class-action suit

a nonprofit organization owned and operated by its members for the purpose of saving money on the purchase of goods and services

cooperative

a portion of the total cost of an item that must be paid at the time of payment

down payment

dishonest business practices that are meant to deceive, trick, or gain an unfair advantage

fraud

unwritten guarantees that cover certain aspects of a product or its use

implied warranties

purchasing items on the spur of the moment

impulse buying

a network of community law offices that provide free or low-cost legal assistance

legal aid society

the attempt by a neutral third party to resolve a conflict b/w a consumer and a business through discussion and negotiation

mediation

a labeling method that indicates the freshness, or shelf life, of a perishable product, such as milk or bread

open dating

a partial refund of the price of a product

rebate

a separately purchased agreement by the manufacturer or distributor to cover the costs of repairing the item

service contract

a court that deals with legal disputes that involve amounts below a certain limit

small claims court

the use of a standard unit of measurement to compare the prices of packages that are different sizes

unit pricing

a written guarantee from the manufacturer or distributor that states the conditions under which the product can be returned, replaced, or repaired

warranty