Question 1

Urban Loan Company extends credit to consumers. Urban is subject to the Equal Credit Opportunity Act, which prohibits credit discrimination based on which of the following

Accepted Answer

The Equal Credit Opportunity Act prohibits credit discrimination based on factors such as race, color, religion, national origin, sex (gender), marital status, age, or because someone receives public assistance. Gender is explicitly mentioned as a protected category.

Question 2

Hearth & Home Furniture store advertises bedroom suites at a "Special Low Price of $599." When Ilene tries to buy one of the suites, Jill, the salesperson, tells her that they are all sold and no more are obtainable. Jill adds that Hearth & Home has other bedroom suites available for as low as $2,599. If done systematically, this is

Accepted Answer

This scenario describes bait-and-switch advertising, where a seller advertises a product at a low price to attract customers but then informs them that the product is unavailable and tries to sell them a higher-priced item instead.

Question 3

Tory applies for a line of credit which she intends to use for a once-in-a-lifetime dream vacation. This transaction is subject to

Accepted Answer

The Truth-in-Lending Act applies to credit transactions, including lines of credit, and requires lenders to disclose terms and costs to borrowers.

Question 4

Under federal law, the calorie content of the food on a menu must be posted by Organic Mix, LLC, if Organic Mix is​

Accepted Answer

Under the federal law, specifically the Affordable Care Act, restaurants and similar retail food establishments with 20 or more locations are required to post calorie information on their menus.

Question 5

Corner Market sells groceries. Delta Food & Drug Store sells groceries and fills prescriptions. The party with the chief responsibility to monitor and enforce laws designed to protect consumers from unsafe food and drugs being sold is

Accepted Answer

The Food and Drug Administration (FDA) is the federal agency responsible for protecting public health by ensuring the safety and security of food and drugs.

Question 6

Bagels n' Pastries, Inc., makes and sells a variety of bread products. Bagels n' Pastries's product packages must include​

Accepted Answer

The contents' net quantity is required by law to be displayed on product packages, ensuring buyers are informed of the amount of product they are purchasing. However, the other options listed (company owner's identity, stores where the product is sold, and type of consumer most likely interested in the product) are not required to be listed on product packages.

Question 7

Marilyn receives an unsolicited credit card in the mail and tosses it on her desk. Without Marilyn's permission, her roommate Nancy uses the card to buy a new laptop for $1,800. Marilyn is​

Accepted Answer

Marilyn did not activate the credit card nor did she give permission to Nancy to use it. Marilyn is not liable for any amount.

Question 8

Gear Motor Company makes cars. Federal law requires Gear to attach an information label that includes the Environmental Protection Agency's fuel economy estimate for a vehicle to​

Accepted Answer

Federal law requires Gear to attach an information label that includes the Environmental Protection Agency's fuel economy estimate for every new car. Therefore, Gear has no choice but to attach the label to every new car in compliance with the law.

Question 9

Cleaners & Solvents, Inc. (CSI), falsely claims in its ads that its product Dirt Remover kills germs "forever." In an action against CSI regarding Dirt Remover, the firm is ordered to stop its false advertising of Dirt Remover and its other products. This is​

Accepted Answer

A multiple product order is a directive that requires a company to cease false advertising for not just one, but all of its products.

Question 10

QuikPay Inc. extends credit to consumers. QuikPay is subject to the Equal Credit Opportunity Act, which prohibits credit discrimination based on which of the following

Accepted Answer

The Equal Credit Opportunity Act prohibits credit discrimination based on race, among other protected characteristics.

Question 11

In its ads, Crunchy Inc. makes various claims about its snack products. Crunchy's advertising claims would most likely be deemed deceptive if the claims​

Accepted Answer

Deceptive advertising claims are those that mislead a reasonable consumer. This means that the claims made by Crunchy Inc. could be considered deceptive if they are not true or are likely to mislead consumers. Vague generalities or obvious exaggerations may also be deceptive, but it ultimately comes down to whether the claims are likely to mislead consumers. Puffery, on the other hand, is a term used to describe exaggerated or vague claims that are unlikely to mislead consumers and are therefore not considered deceptive.

Question 12

Creditworthy Loan Company extends credit in the ordinary course of its busi-ness. Under the Truth-in-Lending Act, Creditworthy must inform potential borrowers of​

Accepted Answer

Under the Truth-in-Lending Act, lenders are required to disclose their own credit terms to potential borrowers, ensuring transparency and allowing borrowers to make informed decisions.

Question 13

Slow-Brew Coffee Company sells coffee and related beverages. The company's ad contends that ambitious businesspersons "Drink Us & Rise Up in the World!' " The Federal Trade Com-mission would consider this ad to be​

Accepted Answer

The answer of Slow-Brew Coffee Company sells coffee and related...

Question 14

Elise and many other consumers complain to the Federal Trade Commission (FTC) that a Faux Diamonds Company ad is deceptive. The FTC's first step is to​

Accepted Answer

The FTC's first step when receiving a complaint about a deceptive ad is to investigate the claims made in the ad. This involves reviewing the ad and gathering information from the company to determine if the claims are indeed deceptive. Only after an investigation is completed can the FTC take further action, such as issuing a cease-and-desist order or ordering restitution.

Question 15

Smart Phone Company's ad states that its product is "The Clear Choice." Because of this ad, the Federal Trade Commission is most likely to issue​

Accepted Answer

The phrase "The Clear Choice" is likely considered puffery, which is a subjective claim and not a factual misrepresentation, so the FTC is unlikely to take action.

Question 16

Logan's application to Metro Bank for a credit card is denied. Logan can obtain information on his credit history in a credit agency's files under​

Accepted Answer

The Fair Credit Reporting Act gives consumers the right to obtain a free copy of their credit report once a year from each of the major credit reporting agencies, which includes information on their credit history. Therefore, Logan can obtain information on his credit history through this act.

Question 17

Sweet Treats, Inc., wants to market a new snack food. On the product's label, standard nutrition facts are​

Accepted Answer

Standard nutrition facts are required to be listed on the label of packaged food products by the Food and Drug Administration (FDA). This is aimed at providing consumers with important information on the nutritional content of the food they are buying, thus allowing them to make informed choices about their diets.

Question 18

Cecilia borrows $20,000 from Debit & Credit Union to repair her home and to buy a car. She buys a laptop from eStuf Store in a transaction financed by the seller. If these parties are subject to the Truth-in-Lending Act, Regulation Z ap-plies to​

Accepted Answer

The Truth-in-Lending Act, Regulation Z applies to all three transactions - the car loan, the home repair loan, and the retail installment sale (for the laptop).

Question 19

Fun-E Products, Inc., makes and sells toys. The government agency that has the authority to remove a imminently hazardous toy from the market is

Accepted Answer

The Consumer Product Safety Commission (CPSC) is the government agency responsible for protecting the public from unreasonable risks of injury or death associated with the use of consumer products, including toys.

Question 20

Wellness Insurance Company offers health and medical insurance to consumers. Under current federal health-care laws, Wellness is prohibited from​

Accepted Answer

The answer of Wellness Insurance Company offers health and medical...

Quiz 13: Consumer Law

Urban Loan Company extends credit to consumers. Urban is subject to the Equal Credit Opportunity Act, which prohibits credit discrimination based on which of the following

Tory applies for a line of credit which she intends to use for a once-in-a-lifetime dream vacation. This transaction is subject to

Under federal law, the calorie content of the food on a menu must be posted by Organic Mix, LLC, if Organic Mix is

Corner Market sells groceries. Delta Food & Drug Store sells groceries and fills prescriptions. The party with the chief responsibility to monitor and enforce laws designed to protect consumers from unsafe food and drugs being sold is

Bagels n' Pastries, Inc., makes and sells a variety of bread products. Bagels n' Pastries's product packages must include

Marilyn receives an unsolicited credit card in the mail and tosses it on her desk. Without Marilyn's permission, her roommate Nancy uses the card to buy a new laptop for $1,800. Marilyn is

Gear Motor Company makes cars. Federal law requires Gear to attach an information label that includes the Environmental Protection Agency's fuel economy estimate for a vehicle to

Cleaners & Solvents, Inc. (CSI) , falsely claims in its ads that its product Dirt Remover kills germs "forever." In an action against CSI regarding Dirt Remover, the firm is ordered to stop its false advertising of Dirt Remover and its other products. This is

QuikPay Inc. extends credit to consumers. QuikPay is subject to the Equal Credit Opportunity Act, which prohibits credit discrimination based on which of the following

In its ads, Crunchy Inc. makes various claims about its snack products. Crunchy's advertising claims would most likely be deemed deceptive if the claims

Creditworthy Loan Company extends credit in the ordinary course of its busi-ness. Under the Truth-in-Lending Act, Creditworthy must inform potential borrowers of

Slow-Brew Coffee Company sells coffee and related beverages. The company's ad contends that ambitious businesspersons "Drink Us & Rise Up in the World!' " The Federal Trade Com-mission would consider this ad to be

Elise and many other consumers complain to the Federal Trade Commission (FTC) that a Faux Diamonds Company ad is deceptive. The FTC's first step is to

Smart Phone Company's ad states that its product is "The Clear Choice." Because of this ad, the Federal Trade Commission is most likely to issue

Logan's application to Metro Bank for a credit card is denied. Logan can obtain information on his credit history in a credit agency's files under

Sweet Treats, Inc., wants to market a new snack food. On the product's label, standard nutrition facts are

Cecilia borrows $20,000 from Debit & Credit Union to repair her home and to buy a car. She buys a laptop from eStuf Store in a transaction financed by the seller. If these parties are subject to the Truth-in-Lending Act, Regulation Z ap-plies to

Fun-E Products, Inc., makes and sells toys. The government agency that has the authority to remove a imminently hazardous toy from the market is

Wellness Insurance Company offers health and medical insurance to consumers. Under current federal health-care laws, Wellness is prohibited from

Quiz 13: Consumer Law

Urban Loan Company extends credit to consumers. Urban is subject to the Equal Credit Opportunity Act, which prohibits credit discrimination based on which of the following

Tory applies for a line of credit which she intends to use for a once-in-a-lifetime dream vacation. This transaction is subject to

Under federal law, the calorie content of the food on a menu must be posted by Organic Mix, LLC, if Organic Mix is​

Corner Market sells groceries. Delta Food & Drug Store sells groceries and fills prescriptions. The party with the chief responsibility to monitor and enforce laws designed to protect consumers from unsafe food and drugs being sold is

Bagels n' Pastries, Inc., makes and sells a variety of bread products. Bagels n' Pastries's product packages must include​

Marilyn receives an unsolicited credit card in the mail and tosses it on her desk. Without Marilyn's permission, her roommate Nancy uses the card to buy a new laptop for $1,800. Marilyn is​

Gear Motor Company makes cars. Federal law requires Gear to attach an information label that includes the Environmental Protection Agency's fuel economy estimate for a vehicle to​

Cleaners & Solvents, Inc. (CSI) , falsely claims in its ads that its product Dirt Remover kills germs "forever." In an action against CSI regarding Dirt Remover, the firm is ordered to stop its false advertising of Dirt Remover and its other products. This is​

QuikPay Inc. extends credit to consumers. QuikPay is subject to the Equal Credit Opportunity Act, which prohibits credit discrimination based on which of the following

In its ads, Crunchy Inc. makes various claims about its snack products. Crunchy's advertising claims would most likely be deemed deceptive if the claims​

Creditworthy Loan Company extends credit in the ordinary course of its busi-ness. Under the Truth-in-Lending Act, Creditworthy must inform potential borrowers of​

Slow-Brew Coffee Company sells coffee and related beverages. The company's ad contends that ambitious businesspersons "Drink Us & Rise Up in the World!' " The Federal Trade Com-mission would consider this ad to be​

Elise and many other consumers complain to the Federal Trade Commission (FTC) that a Faux Diamonds Company ad is deceptive. The FTC's first step is to​

Smart Phone Company's ad states that its product is "The Clear Choice." Because of this ad, the Federal Trade Commission is most likely to issue​

Logan's application to Metro Bank for a credit card is denied. Logan can obtain information on his credit history in a credit agency's files under​

Sweet Treats, Inc., wants to market a new snack food. On the product's label, standard nutrition facts are​

Cecilia borrows $20,000 from Debit & Credit Union to repair her home and to buy a car. She buys a laptop from eStuf Store in a transaction financed by the seller. If these parties are subject to the Truth-in-Lending Act, Regulation Z ap-plies to​

Fun-E Products, Inc., makes and sells toys. The government agency that has the authority to remove a imminently hazardous toy from the market is

Wellness Insurance Company offers health and medical insurance to consumers. Under current federal health-care laws, Wellness is prohibited from​

Under federal law, the calorie content of the food on a menu must be posted by Organic Mix, LLC, if Organic Mix is

Bagels n' Pastries, Inc., makes and sells a variety of bread products. Bagels n' Pastries's product packages must include

Marilyn receives an unsolicited credit card in the mail and tosses it on her desk. Without Marilyn's permission, her roommate Nancy uses the card to buy a new laptop for $1,800. Marilyn is

Gear Motor Company makes cars. Federal law requires Gear to attach an information label that includes the Environmental Protection Agency's fuel economy estimate for a vehicle to

Cleaners & Solvents, Inc. (CSI) , falsely claims in its ads that its product Dirt Remover kills germs "forever." In an action against CSI regarding Dirt Remover, the firm is ordered to stop its false advertising of Dirt Remover and its other products. This is

In its ads, Crunchy Inc. makes various claims about its snack products. Crunchy's advertising claims would most likely be deemed deceptive if the claims

Creditworthy Loan Company extends credit in the ordinary course of its busi-ness. Under the Truth-in-Lending Act, Creditworthy must inform potential borrowers of

Slow-Brew Coffee Company sells coffee and related beverages. The company's ad contends that ambitious businesspersons "Drink Us & Rise Up in the World!' " The Federal Trade Com-mission would consider this ad to be

Elise and many other consumers complain to the Federal Trade Commission (FTC) that a Faux Diamonds Company ad is deceptive. The FTC's first step is to

Smart Phone Company's ad states that its product is "The Clear Choice." Because of this ad, the Federal Trade Commission is most likely to issue

Logan's application to Metro Bank for a credit card is denied. Logan can obtain information on his credit history in a credit agency's files under

Sweet Treats, Inc., wants to market a new snack food. On the product's label, standard nutrition facts are

Cecilia borrows $20,000 from Debit & Credit Union to repair her home and to buy a car. She buys a laptop from eStuf Store in a transaction financed by the seller. If these parties are subject to the Truth-in-Lending Act, Regulation Z ap-plies to

Wellness Insurance Company offers health and medical insurance to consumers. Under current federal health-care laws, Wellness is prohibited from