The Insecto Co. advertised on television its product, the "Fly-Bye," a sheet of sticky paper that attracted and then glued flies to its surface. The advertising claimed that the product would catch up to 100 flies per hour for six hours or the purchase price of $9.99 would be refunded.
A) The Insecto Co. must test at least 95% of its products for its claim to be valid.
B) Insecto Co. may be prosecuted under the Competition Act if one local distributor were selling Fly-Byes for $10.99.
C) If Insecto Co. were to sell Fly-Byes to hardware stores for resale it may continue to advertise and price the product at $9.99.
D) A hardware store that advertises a two-day promotion on Fly-Byes for $5.99 must provide shoppers with a "rain cheque" if it mistakenly did not order enough goods.
E) Insecto Co. may be prosecuted under the Competition Act if one local distributor were selling Fly-Byes for $10.99 and if a hardware store advertised a two-day promotion on Fly-Byes for $5.99.

Question

Quizplus · Accepted Answer

The Competition Act prohibits price discrimination and deceptive marketing practices. Selling Fly-Byes for different prices by different distributors and advertising a promotion without having enough stock to meet demand are both violations of the Act.