Question 1

The Fair Credit Reporting Act protects the consumer by limiting the amount of interest charged on credit card accounts.

Accepted Answer

The Fair Credit Reporting Act regulates how consumer credit information is collected, shared, and used by credit reporting agencies. It does not regulate interest rates on credit card accounts.

Question 2

Unsolicited merchandise sent by U.S.mail may be kept by the recipient without incurring any obligation to the sender.

Accepted Answer

According to the Federal Trade Commission, unsolicited merchandise sent by U.S. mail may be treated as a gift and may be kept by the recipient without the obligation to pay or return it.

Question 3

A car loan is an example of a closed-end credit transaction.

Accepted Answer

A car loan typically involves borrowing a specific amount of money to purchase a vehicle, with a fixed interest rate and repayment term. This is an example of closed-end credit, where the borrower receives a one-time loan for a specific purpose and agrees to make regular payments until the loan is fully repaid.

Question 4

If a used car is sold without a warranty,the label must state that the car is being sold "as is."

Accepted Answer

This is required by law in many states in the US, and failure to do so could result in legal consequences for the seller.

Question 5

State may regulate odometer tampering,but there is no federal law that does so.

Accepted Answer

The answer of State may regulate odometer tampering,but there is...

Question 6

The U.S.Supreme Court has ruled that compounded drugs are illegal.

Accepted Answer

The U.S. Supreme Court has not issued a ruling that compounded drugs are illegal. Compounded drugs are legal as long as they are made by a licensed pharmacist or physician and comply with certain regulations. However, the FDA has taken actions in recent years to increase oversight of compounding pharmacies and some states have enacted their own regulations.

Question 7

The Wool Products Labeling Act is an example of a federal law regulating the labeling of clothing.

Accepted Answer

The Wool Products Labeling Act is a federal law that regulates the labeling of clothing made from wool. It requires manufacturers to include specific information on the label, such as the percentage of wool in the garment and the country of origin. This law helps consumers make informed purchasing decisions and promotes fair trade practices in the clothing industry.

Question 8

In general,consumer protection law at the state level is more stringent than federal law.

Accepted Answer

States often have their own consumer protection laws that go beyond what is required by federal law, resulting in more stringent regulations at the state level.

Question 9

In some cases,even if a manufacturer provides warnings as mandated by the Food and Drug Administration,it may still be fund liable under state product liability law for failure to warn if reasonable manufacturers would have done more.

Accepted Answer

State product liability laws may impose a higher duty of care on manufacturers to provide appropriate warnings and instructions, and failure to meet this duty may result in liability even if the manufacturer complies with the FDA's warning requirements. Therefore, if it is found that reasonable manufacturers in the same industry would have provided additional warnings or instructions, the manufacturer may still be held liable for failing to do so under state law.

Question 10

The labeling of medical devices is under the jurisdiction of the Food and Drug Administration.

Accepted Answer

The labeling of medical devices is regulated by the Food and Drug Administration under the Code of Federal Regulations (21 CFR Part 801).

Question 11

Congress has made it a federal crime to engage in the extortionate extension of credit.

Accepted Answer

The prohibition against extortionate extension of credit is codified in section 891 et seq. of Title 18, U.S. Code, and is punishable as a federal crime.

Question 12

The Food and Drug Administration has the authority to require that certain drugs be available only by prescription.

Accepted Answer

The FDA has the authority to regulate prescription drugs and can require them to be available only by prescription.

Question 13

The Fair Debt Collection Practices Act applies only to third-party debt collectors.

Accepted Answer

The FDCPA only applies to third-party debt collectors who collect debts on behalf of someone else. It does not apply to creditors attempting to collect their own debts.

Question 14

The Fair Credit Reporting Act does not give consumers a right to have corrected copies of their credit reports sent to creditors.

Accepted Answer

The Fair Credit Reporting Act does give consumers the right to request corrected copies of their credit reports be sent to creditors. This is known as a "reinvestigation" process.

Question 15

The Truth-in-Lending Act limits credit card liability to $50 per card for unauthorized charges made before a card issuer is notified of a lost or stolen card.

Accepted Answer

This statement is true. According to the Truth-in-Lending Act, credit card liability for unauthorized charges made before the card issuer is notified of a lost or stolen card is limited to $50 per card.

Question 16

Executive branch regulatory agencies are located in cabinet departments.

Accepted Answer

Executive branch regulatory agencies are typically located within the various cabinet departments of the executive branch, such as the Environmental Protection Agency within the Department of Energy.

Question 17

The Truth-in-Lending Act (TILA)is intended to assure a truthful loan application by the consumer.

Accepted Answer

The Truth-in-Lending Act (TILA) is intended to assure a truthful disclosure of the terms and costs of a credit transaction by the creditor or lender.

Question 18

Courts usually consider advertisements to be only an offer to deal.

Accepted Answer

Courts consider advertisements to be an invitation to make an offer rather than a binding agreement. This means that the advertiser is inviting potential customers to make an offer to buy the product or service, rather than guaranteeing to sell it at the advertised price or terms.

Question 19

The Federal Commerce Commission has adopted guidelines specifying when manufacturers and marketers can label their products "Made in USA."

Accepted Answer

The Federal Trade Commission (FTC) is the agency that has adopted guidelines specifying when manufacturers and marketers can label their products "Made in USA."

Question 20

Under the Magnuson-Moss Warranty Act,a seller who offers a written warranty on goods must provide a full warranty.

Accepted Answer

The Magnuson-Moss Warranty Act does not require a seller to provide a full warranty. It allows for either a "full" or "limited" warranty as long as the warranty terms are clearly disclosed.

Quiz 18: Consumer Protection