Question 1

The aim of consumer protection legislation is to protect persons of limited means and limited knowledge.

Accepted Answer

Consumer protection legislation is designed to protect individuals with limited knowledge and resources from unfair business practices or products. This can include measures such as requiring clear labeling and advertising, providing access to information about goods and services, and establishing consumer complaint processes.

Question 2

Consumer protection statutes apply only in situations in which the statute is intentionally violated.

Accepted Answer

Consumer protection statutes can apply in situations where the violation is unintentional, as long as there was a breach of duty or failure to exercise reasonable care that resulted in harm to the consumer.

Question 3

Dilatory lending is a practice on the part of the subprime lending market whereby lenders take advantage of less sophisticated consumers or those who are desperate for funds by using the lenders' superior bargaining positions to obtain credit terms that go well beyond compensating them for their risk.

Accepted Answer

False

Question 4

Consumer protection laws, which commonly regulate the form of consumer contracts, provide that back-page disclaimers are void if the front page of a contract does not call attention to the presence of the terms on the back page.

Accepted Answer

Consumer protection laws require that important terms and conditions are prominently displayed on the front page of a contract, and if the back-page disclaimers are not brought to the consumer's attention on the front page, they are considered void.

Question 5

The FTC requires advertisers to maintain records of the data used as support for statements made in the ads that deal with the safety, performance, efficacy, quality, or comparative price of an advertised product.

Accepted Answer

This is true according to the FTC's Advertising and Marketing Guidelines. Advertisers must maintain records to prove the accuracy and truthfulness of any claims made in their advertisements.

Question 6

Consumer protection legislation regulates the prices that sellers may charge consumers.

Accepted Answer

Consumer protection legislation does not typically directly regulate prices, but instead focuses on prohibiting unfair sales practices, ensuring accurate advertising, and providing remedies for consumers who have been defrauded or harmed by a product. Some industries may have price controls or regulations, but this is not a feature of general consumer protection laws.

Question 7

A sale of goods or services for $25 or more made to a buyer at home may be set aside within five (5) business days.

Accepted Answer

The answer of A sale of goods or services for...

Question 8

The types of provisions that make contracts unconscionable include clauses that award excessive damages or the application of credit payments across purchases over time so that the consumer is never able to pay off any goods.

Accepted Answer

These are both examples of provisions that may make a contract unconscionable.

Question 9

Corrective advertising required by the FTC also is called retroactive advertising.

Accepted Answer

Corrective advertising required by the FTC is not called retroactive advertising. Retroactive advertising refers to advertising that is developed after a campaign has already been launched in an effort to make up for any missed opportunities or mistakes. Corrective advertising, on the other hand, is specifically required by the FTC when a company has made deceptive or false claims in its advertising and is meant to correct those claims and prevent future deception.

Question 10

The FTC requires that only descriptive and non-ambiguous terms such as jumbo, giant, or full be used in product labeling.

Accepted Answer

The statement is false. The FTC requires that product labeling should not use terms that are false or misleading. Descriptive terms such as jumbo, giant, or full can be used, but they must accurately reflect the product's size or volume. The terms used in product labeling should also not be ambiguous, but there is no requirement to use only descriptive terms.

Question 11

Violation of a consumer protection statute occurs even without proof that the wrongdoer intended to defraud or deceive anyone.

Accepted Answer

Many consumer protection statutes, such as those that prohibit false advertising or require certain disclosures, do not require intent to deceive or defraud. Violations can occur simply by the false or misleading information or omission of required information.

Question 12

The category of protected consumers has been expanded by the social forces of protecting the person and protecting from fraud, exploitation, and oppression.

Accepted Answer

Over time, social forces have expanded the category of protected consumers beyond just protecting against physical harm and product safety to include protecting consumers from fraud, exploitation, and oppression.

Question 13

Those who are liable for violations of consumer protection situations are persons or enterprises that regularly enter into the type of transaction in which the injured consumer was involved.

Accepted Answer

Persons or enterprises that regularly engage in transactions similar to those in which the injured consumer was involved can be held responsible for violations of consumer protection laws. This includes manufacturers, retailers, and service providers.

Question 14

The subterranean lending market makes loans to consumers who have bankruptcies, no credit history, low-to-moderate incomes, or a poor credit history.

Accepted Answer

The answer of The subterranean lending market makes loans to...

Question 15

Consumer protection even protects a consumer from the consumer's own negligence.

Accepted Answer

Consumer protection laws generally provide protection from fraudulent or unfair practices by businesses, but they do not typically protect consumers from their own negligence or poor judgment.

Question 16

To be found guilty of violating a consumer protection statute or a deceptive trade practices act, a defendant must be proven guilty of fraud.

Accepted Answer

While fraud may be one of the elements of a violation of a consumer protection statute or deceptive trade practices act, it is not always necessary. These laws typically prohibit a variety of deceptive or unfair practices that do not always involve fraud.

Question 17

A consumer claiming that there has been a violation of a consumer protection statute has the burden of proving that the statutory definition of "consumer" has been satisfied.

Accepted Answer

This statement is true. In order to bring a claim under a consumer protection statute, the individual bringing the claim must meet the statutory definition of "consumer." It is the burden of the plaintiff to prove that they meet this definition.

Question 18

Labels on packages are regulated to provide information about the contents and warnings about the dangers involved in the use of the product.

Accepted Answer

This statement is true. Labels on packages are regulated by government agencies to ensure that consumers are accurately informed about the contents of the product and any potential safety hazards associated with its use.

Question 19

In order to recover under a fair business practices or deceptive trade practices act, a consumer is only required to show that the defendant is in breach of contract.

Accepted Answer

In order to recover under a fair business practices or deceptive trade practices act, a consumer is required to show more than just a breach of contract. They must demonstrate that the defendant engaged in some form of deceptive, unfair, or fraudulent conduct.

Question 20

Consumer protection law often requires those dealing with consumers to make certain mandated disclosures.

Accepted Answer

Consumer protection laws often mandate that businesses make certain disclosures to consumers in order to help protect them from harm or unethical practices. These disclosures can include information about fees, interest rates, terms and conditions of contracts, and potential risks associated with particular products or services. Failure to make these mandated disclosures can result in legal consequences for the business.

Quiz 33: Consumer Protection