Question 1

Creditors attempting to collect debts are generally considered to be debt-collection agencies.

Accepted Answer

The answer of Creditors attempting to collect debts are generally...

Question 2

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 Commission would consider this ad to be​

Accepted Answer

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

Question 3

Credit can be denied solely on the basis of marital status.

Accepted Answer

Under the Equal Credit Opportunity Act (ECOA), it is illegal for creditors to discriminate on the basis of marital status. Creditors are required to evaluate credit applications based on an individual's creditworthiness, income, and other relevant factors, but not on the basis of marital status.

Question 4

A consumer who receives an unsolicited credit card can be charged by the company that issued the card for any unauthorized charges.

Accepted Answer

According to the Federal Trade Commission's regulations, a consumer cannot be held liable for any unauthorized charges on an unsolicited credit card. The company that issued the card is responsible for any charges made without the consumer's knowledge or consent.

Question 5

Home Products,Inc. ,in its advertisements,makes false claims about its own products and about the products of its competitors. The firm may be subject to sanctions for the false claims about​

Accepted Answer

The answer of Home Products,Inc. ,in its advertisements,makes false claims...

Question 6

Soundbytes Corporation sells phones.Soundbytes's ad states that voice on its phones is "clear as blue sky on a cloudless day." The Federal Trade Commission would consider this claim​

Accepted Answer

The answer of Soundbytes Corporation sells phones.Soundbytes's ad states that...

Question 7

The Truth-in-Lending Act applies to persons who,in the ordinary course of their business,lend money,sell on credit,or arrange for the extension of credit.

Accepted Answer

The statement is true. The Truth-in-Lending Act (TILA) applies to individuals or companies who engage in lending money, selling on credit, or arranging for the extension of credit as part of their regular business activities. TILA requires these entities to disclose important information to consumers about the costs and terms associated with credit transactions, including interest rates, fees, and payment schedules.

Question 8

A credit-card company may increase the interest rate on a customer's credit-card balance at any time.

Accepted Answer

The answer of A credit-card company may increase the interest...

Question 9

Through careless manufacturing practices,Plastics Company makes and sells products that are unsafe to consumers.This may be subject to sanctions under​

Accepted Answer

Both federal and state laws have regulations and guidelines related to product safety and manufacturing practices. Therefore, the Plastics Company may be subject to sanctions under federal and state law for producing and selling unsafe products. The principle of freedom to contract does not override the need for businesses to adhere to safety standards and regulations.

Question 10

Account numbers on credit-card receipts must be truncated (shortened).

Accepted Answer

Truncating credit-card numbers on receipts helps to protect consumers' sensitive financial information from potential fraud and identity theft. This is a requirement under the Payment Card Industry Data Security Standards (PCI DSS).

Question 11

Credit can be denied if a person receives a certain form of income.

Accepted Answer

The answer of Credit can be denied if a person...

Question 12

A credit-cardholder is liable for all unauthorized charges made before the creditor is notified that the card has been lost.

Accepted Answer

The answer of A credit-cardholder is liable for all unauthorized...

Question 13

A consumer may be denied credit or insurance on the basis of his or her credit report,and need not be notified of that fact.

Accepted Answer

The answer of A consumer may be denied credit or...

Question 14

Imported foods do not have to meet U.S.safety standards.

Accepted Answer

Imported foods must meet U.S. safety standards. The U.S. Food and Drug Administration (FDA) is responsible for ensuring the safety of imported foods and can refuse entry of any food that does not meet U.S. standards. Importers are also responsible for verifying that their products meet U.S. safety requirements.

Question 15

Consumers who are charged more for credit or insurance than others ordinarily would be because of their credit reports must be notified of that fact.

Accepted Answer

This is required by the Fair Credit Reporting Act (FCRA) which mandates that consumers must be notified when their credit report is used against them in decisions related to credit or insurance, and also provides them with the right to access and dispute any inaccuracies in their report.

Question 16

Lawncare Company and Mowers,Inc.make yard tools.Both companies use only steel produced in the United States.Lawncare's ad claims,"We use only U.S.steel,while our competitors use inferior foreign steel!" This statement is​

Accepted Answer

The answer of Lawncare Company and Mowers,Inc.make yard tools.Both companies...

Question 17

The Federal Reserve Board of Governors has issued a regulation that governs credit provisions associated with sales contracts-Regulation Z.

Accepted Answer

The answer of The Federal Reserve Board of Governors has...

Question 18

The Fair Debt Collection Practices Act attempts to ensure that creditors are always paid by debtors.

Accepted Answer

The Fair Debt Collection Practices Act sets guidelines on how debt collectors can communicate with debtors, but it does not guarantee payment from debtors to creditors. Its main purpose is to prevent abusive or harassing behaviors by debt collectors.

Question 19

A credit collection agency may contact a debtor at any time.

Accepted Answer

The answer of A credit collection agency may contact a...

Question 20

In a transaction subject to the Truth-in-Lending Act,the terms of a credit instrument must be fully disclosed.

Accepted Answer

The Truth-in-Lending Act requires that the terms and conditions of a credit transaction must be fully disclosed to the borrower. This ensures that the borrower understands the costs associated with the credit and can make an informed decision before entering into the transaction.

Quiz 24: Consumer Protection