Question 1

Herman's Hammer Company and Melissa's Mallets,Inc.both make hammers.Both companies only use steel produced in the United States to make their hammers.Herman's Hammer Company displays an ad in the local hardware store that says,"Buy from Herman's - we only use American steel,while competitors like Melissa's Mallets use inferior foreign steel!" The statement in the ad is

Accepted Answer

The statement in the ad is a false claim about a competitor's product since Melissa's Mallets also uses American steel. It is a deceptive advertisement aimed at discrediting the competitor.

Question 2

Drugs can be test-marketed to the public before they are ensured to be safe and effective.

Accepted Answer

Drugs must go through extensive clinical trials and be approved by regulatory agencies such as the FDA before they can be marketed to the public. Testing a drug on the public before it is deemed safe and effective could be dangerous and unethical.

Question 3

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

Accepted Answer

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

Question 4

The Food and Drug Administration must ensure the safety of new drugs.

Accepted Answer

This is true. The FDA is responsible for regulating and approving new drugs before they can be sold to consumers, and ensuring that they meet safety and efficacy standards.

Question 5

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 6

Soundbites Corporation makes and markets cellphones.Soundbites's ad states that on its phones voices and text come through as "clear as the sky on a cloudless day." The Federal Trade Com-mission would consider this claim

Accepted Answer

The answer of Soundbites Corporation makes and markets cellphones.Soundbites's ad...

Question 7

Wild Things,Inc.(WTI),in its ads,makes claims about its products that are obvious exaggerations and claims that are false but appear to be true.WTI may be subject to sanctions for​

Accepted Answer

The answer of Wild Things,Inc.(WTI),in its ads,makes claims about its...

Question 8

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

Accepted Answer

The Truth-in-Lending Act requires full disclosure of all terms of a credit instrument, including the amount financed, finance charge, annual percentage rate (APR), and payment schedule. Failing to disclose any material terms could result in penalties for the creditor.

Question 9

The main purpose of the Fair Debt Collection Practices Act is to ensure that creditors are always paid by debtors.

Accepted Answer

The main purpose of the Fair Debt Collection Practices Act is to protect consumers from abusive and unfair debt collection practices by debt collectors. It sets guidelines that debt collectors must follow, such as not contacting consumers at unreasonable times or using deceptive or harassing tactics. It also gives consumers the right to dispute debts and request validation of the debt.

Question 10

Manufacturers are required to report on any products intended for sale if the products have proved to be hazardous.

Accepted Answer

It is true that manufacturers are required to report on any products intended for sale if the products have proved to be hazardous. This is done to protect consumers and prevent harm from dangerous products.

Question 11

Credit can be denied solely on the basis of race.

Accepted Answer

Denying credit solely on the basis of race is illegal under the Equal Credit Opportunity Act (ECOA). Lenders are required to make credit decisions based on the individual's creditworthiness, not their race or other protected characteristics.

Question 12

Merchants must issue a refund within a specified period of time when a consumer cancels an order.

Accepted Answer

Merchants are required to issue a refund within a reasonable period of time when a consumer cancels an order. The specific time period may vary depending on the terms and conditions of the company, but it must be clearly stated at the time of purchase.

Question 13

A consumer who believes that he or she has been or may be victimized by identity theft may place an alert on his or her credit file.

Accepted Answer

This is true. A consumer may place an alert on his or her credit file if there is a suspicion of identity theft to prevent any unauthorized use of the credit.

Question 14

A debt-collection agency is someone who regularly attempts to collect debts on behalf of someone else,usually for a percentage of the amount owed.

Accepted Answer

A debt-collection agency is hired by creditors to collect debts on their behalf, and they typically charge a percentage of the amount collected as their fee.

Question 15

A credit-card company must send monthly bills to cardholders twenty-one days before the due date.

Accepted Answer

This is required by the Truth in Lending Act (TILA).

Question 16

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

Accepted Answer

National Home Products, Inc. can be subject to sanctions for making false claims about both its own products and its competitors' products. False advertising laws prohibit companies from making false or misleading statements that could deceive or mislead consumers about a product's attributes, characteristics, or qualities. This applies to both their own products and their competitors' products.

Question 17

Any time a consumer is denied credit or insurance on the basis of his or her credit report,the consumer must be notified of that fact.

Accepted Answer

This is a requirement of the Fair Credit Reporting Act (FCRA). The consumer must be provided with the name and contact information of the credit bureau that provided the report, as well as details on how to obtain a free copy of the report. Additionally, the consumer has the right to dispute any errors in the report that may have contributed to the denial of credit or insurance.

Question 18

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 19

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 20

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...

Quiz 22: Consumer Protection

Drugs can be test-marketed to the public before they are ensured to be safe and effective.

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

The Food and Drug Administration must ensure the safety of new drugs.

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

Soundbites Corporation makes and markets cellphones.Soundbites's ad states that on its phones voices and text come through as "clear as the sky on a cloudless day." The Federal Trade Com-mission would consider this claim

Wild Things,Inc.(WTI) ,in its ads,makes claims about its products that are obvious exaggerations and claims that are false but appear to be true.WTI may be subject to sanctions for

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

The main purpose of the Fair Debt Collection Practices Act is to ensure that creditors are always paid by debtors.

Manufacturers are required to report on any products intended for sale if the products have proved to be hazardous.

Credit can be denied solely on the basis of race.

Merchants must issue a refund within a specified period of time when a consumer cancels an order.

A consumer who believes that he or she has been or may be victimized by identity theft may place an alert on his or her credit file.

A debt-collection agency is someone who regularly attempts to collect debts on behalf of someone else,usually for a percentage of the amount owed.

A credit-card company must send monthly bills to cardholders twenty-one days before the due date.

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

Any time a consumer is denied credit or insurance on the basis of his or her credit report,the consumer must be notified of that fact.

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

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

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

Quiz 22: Consumer Protection

Drugs can be test-marketed to the public before they are ensured to be safe and effective.

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

The Food and Drug Administration must ensure the safety of new drugs.

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

Soundbites Corporation makes and markets cellphones.Soundbites's ad states that on its phones voices and text come through as "clear as the sky on a cloudless day." The Federal Trade Com-mission would consider this claim

Wild Things,Inc.(WTI) ,in its ads,makes claims about its products that are obvious exaggerations and claims that are false but appear to be true.WTI may be subject to sanctions for​

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

The main purpose of the Fair Debt Collection Practices Act is to ensure that creditors are always paid by debtors.

Manufacturers are required to report on any products intended for sale if the products have proved to be hazardous.

Credit can be denied solely on the basis of race.

Merchants must issue a refund within a specified period of time when a consumer cancels an order.

A consumer who believes that he or she has been or may be victimized by identity theft may place an alert on his or her credit file.

A debt-collection agency is someone who regularly attempts to collect debts on behalf of someone else,usually for a percentage of the amount owed.

A credit-card company must send monthly bills to cardholders twenty-one days before the due date.

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

Any time a consumer is denied credit or insurance on the basis of his or her credit report,the consumer must be notified of that fact.

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

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

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

Wild Things,Inc.(WTI) ,in its ads,makes claims about its products that are obvious exaggerations and claims that are false but appear to be true.WTI may be subject to sanctions for