Question 1

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

Accepted Answer

Consumer protection legislation aims to protect persons who may have limited financial resources or may not have adequate knowledge of their consumer rights. This includes protecting consumers from fraudulent activities, misleading advertising, and dangerous or defective products.

Question 2

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

Accepted Answer

This statement is false. The FTC has guidelines for product labeling that aim to prevent deceptive practices, but they do not specifically require the use of only descriptive and non-ambiguous terms. However, the use of clear and accurate language is encouraged.

Question 3

Predatory 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

Predatory lending involves taking advantage of vulnerable customers by using superior bargaining power to obtain credit terms that are unfair and do not adequately compensate the lender for the risk involved.

Question 4

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

Accepted Answer

Consumer protection laws often require businesses to make certain disclosures to consumers, such as information about pricing, fees, and terms and conditions of a transaction. Failure to make these disclosures can result in legal repercussions.

Question 5

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

This statement is true. Other provisions that may make contracts unconscionable include clauses that waive the consumer's legal rights, provisions that are hidden or difficult to understand, and terms that unfairly benefit one party over the other.

Question 6

Despite consumer protection legislation,for most consumers pursing their rights in court is not cost beneficial.

Accepted Answer

The answer of Despite consumer protection legislation,for most consumers pursing...

Question 7

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 8

A sale of goods or services for $25 or more made to a buyer at home may be set aside without cause within five (5)business days.

Accepted Answer

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

Question 9

Consumers must re-register every three years in order to stay on the National Do Not Call Registry.

Accepted Answer

Once a number is registered on the National Do Not Call Registry, it remains there permanently unless the consumer removes it or the number is disconnected and reassigned to someone else.

Question 10

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

The FTC (Federal Trade Commission) does require advertisers to maintain records of the data used as support for statements made in ads related to the safety, performance, efficacy, quality, or comparative price of a product. This is to ensure that the claims made by advertisers can be substantiated and are not misleading to consumers. Failure to maintain such records can result in legal action taken by the FTC.

Question 11

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 do indeed 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.

Question 12

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 is true. Governments regulate labeling requirements to protect consumers and ensure that they make informed decisions about products. These requirements can include information about ingredients, nutritional value, expiration dates, and warnings about the potential risks associated with using the product.

Question 13

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

Accepted Answer

Corrective advertising is not called retroactive advertising. Retroactive advertising refers to advertising that is used to promote or highlight past accomplishments or successes of a product or brand, whereas corrective advertising is used to correct any false or misleading claims previously made in advertising.

Question 14

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 is because the consumer protection statutes define who qualifies as a "consumer," and it is the consumer's responsibility to prove that they meet the definition.

Question 15

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

Accepted Answer

Consumer protection laws are intended to protect consumers from unfair or deceptive practices by businesses, but they do not provide protection from a consumer's own negligence or misuse of a product. Consumers are expected to exercise reasonable care and follow instructions when using products, and if they fail to do so, they may be held responsible for any resulting harm.

Question 16

Individuals can seek criminal and civil penalties against those who violate consumer protection statutes.

Accepted Answer

Individuals can seek civil penalties, but criminal penalties are pursued by the state or federal government, not by individuals.

Question 17

An auto dealer who does not actually know of a roll-back can use lack of knowledge as a defense against odometer fraud,regardless of the condition of the car.

Accepted Answer

Under federal law, ignorance of an odometer rollback is not a defense for auto dealers. Dealers are expected to know, or should have known, about the true mileage of the vehicles they sell, and they have a responsibility to ensure the accuracy of the odometer readings.

Question 18

Consumer protection statutes are identical in all fifty states and the District of Columbia.

Accepted Answer

Consumer protection statutes vary significantly between states, although some states may have similar or comparable laws.

Question 19

The category of protected consumers for many statutes has been expanded to include partnerships,corporations and government entities.

Accepted Answer

Many statutes have expanded the category of protected consumers to include partnerships, corporations, and government entities. This is to ensure that these entities are also protected from certain unfair or deceptive practices in the marketplace.

Question 20

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

This is known as the "regular course of business" requirement in consumer protection law. It ensures that those who are held liable have a consistent pattern of engaging in the type of conduct that caused harm to the consumer.

Quiz 33: Consumer Protection