Question 1

Even though advertizing issues are complex, the must include:

Accepted Answer

D

Question 2

The consumers who think ahead, consider, and watch every penny they spend, knowing how their choices will affect their preferences are known as:

Accepted Answer

Consumers who carefully consider their spending to ensure it aligns with their preferences and maximizes their satisfaction are known as rational utility maximizers. This concept is fundamental in economics, where individuals are assumed to make decisions that maximize their utility, or happiness, given their budget constraints.

Question 3

The most common criticism of advertising concerns its effect on the consumer's beliefs.

Accepted Answer

The most common criticism of advertising is that it can manipulate consumer beliefs and behaviors by presenting information in a biased or misleading way, often leading to the promotion of consumerism and unrealistic expectations.

Question 4

A study by consumer reports found errors in 43 percent of the credit reports that they analyzed.

Accepted Answer

Consumer Reports conducted a study where they found that 34% of volunteers spotted at least one error in their credit reports, indicating a significant prevalence of inaccuracies in credit reporting.

Question 5

Research has shown people are irrational and inconsistent when weighing choices based on probability estimates of future costs and payoffs.

Accepted Answer

This is supported by various studies in behavioral economics, demonstrating that people often use heuristics and biases, leading to deviations from what would be considered rational decision-making based on probability estimates of future costs and payoffs.

Question 6

Critics to the market approach respond that the benefits of free markets are obtained only when the markets have all of the seven defining characteristics. Several of these are:

Accepted Answer

The answer of Critics to the market approach respond that...

Question 7

Credit Solutions has been sued by the attorney general of five states

Accepted Answer

There is no verifiable information available up to October 2023 indicating that Credit Solutions has been sued by the attorney general of five states.

Question 8

The due care theory of the manufacturer's duties to consumers is based on the idea that consumers and sellers do not meet as equals and that the consumer's interests are particularly vulnerable to being harmed by the manufacturer, who has a knowledge and an expertise that the consumer lacks.

Accepted Answer

The due care theory emphasizes that manufacturers have a duty to prevent harm to consumers due to the inherent imbalance in knowledge and power between consumers and manufacturers, recognizing the vulnerability of consumers.

Question 9

Although there are some advertisements that are intended to manipulate, such advertisements do not violate the consumer's right to be treated as a free and equal rational being.

Accepted Answer

Advertisements intended to manipulate can violate the consumer's right to be treated as a free and equal rational being by undermining their autonomy and ability to make informed decisions.

Question 10

Which are the three main credit reporting companies?

Accepted Answer

The three main credit reporting companies are Experian, Equifax, and TransUnion LLC. These agencies collect and maintain information on consumers' credit histories, which lenders use to make credit decisions.

Question 11

In a narrow sense, the right to privacy can be defined as the right of persons to determine what, to whom, and how much information about themselves will be disclosed to other parties.

Accepted Answer

The right to privacy in a narrow sense indeed focuses on an individual's control over their personal information, including the decision-making power regarding the disclosure of such information to others.

Question 12

In the Market Approach to consumer protection, if consumers do not place a high value on safety (or are unwilling to pay for it), then it is wrong to force them to accept higher levels of safety through regulation.

Accepted Answer

The Market Approach suggests that consumer preferences should dictate product features, including safety, and imposing regulations contrary to these preferences can be seen as paternalistic.

Question 13

The theory of business' duties to consumers claims that a business has four main moral duties: the basic duty of (a) complying with the terms of the sales contract, and the secondary duties of (b) disclosing the nature of the product, (c) avoiding misrepresentation, and (d) avoiding the use of duress and undue influence.

Accepted Answer

The correct term is "Contractual" because it directly relates to the obligations and duties arising from contracts, including sales contracts mentioned in the theory.

Quiz 6: The Ethics of Consumer and Marketing