Question 1

_____ occurs when salespeople make unfair or untrue statements to customers about a competitor,its products or its salespeople.

Accepted Answer

This is a case of business defamation, where salespeople make false statements about a competitor or its products. This is an unethical business practice that can damage the reputation of the competitor and mislead customers.

Question 2

Three companies were selected as potential suppliers of computer equipment for an organization's headquarters.After the negotiations began,representatives of two of the firms met and developed a scheme to eliminate the third company from the competition.This is an example of:

Accepted Answer

The representatives of two firms colluded to eliminate competition, which means they worked together in a secret agreement to achieve a particular goal or outcome. Therefore, option D is the best choice.

Question 3

_____ refers to competitors working together while the customer is making a purchase decision.

Accepted Answer

Collusion refers to competitors working together, which can be illegal if it involves price-fixing or market allocation. In the context of the question, collusion would refer to competitors coordinating their actions or messaging during the customer's decision-making process in order to influence the outcome.

Question 4

A group of uniform rental companies agreed that neither would charge less than $5 per week per uniform even before the newly opened chicken plant contacted them for bids.This is an example of:

Accepted Answer

The answer of A group of uniform rental companies agreed...

Question 5

Court decisions related to the Robinson-Patman Act define _____ as a seller giving unjustified special prices,discounts,or services to some customers and not to others.

Accepted Answer

This definition is specifically describing price discrimination, which is a violation of the Robinson-Patman Act. Reciprocity refers to an agreement between two parties to promote each other's business, a spiff is a bonus payment for making a sale, a tying contract involves requiring a buyer to purchase one product in order to obtain another, and business deception is a broad term that can refer to a variety of fraudulent or unethical practices.

Question 6

The _____ Act requires written notification to customers regarding privacy policies.

Accepted Answer

The Gramm-Leach-Bliley Act requires financial institutions to provide written privacy notices and explain how they collect, use and protect customers' nonpublic personal information.

Question 7

A small appliance manufacturer,trying to build a factory in one Mexican state,offered the governor a bribe of $12,000 to waive off certain environmental regulations for the manufacturing concern.This is an example of:

Accepted Answer

Subordination refers to the act of offering something of value, such as a bribe, to a public official to influence their actions or decisions, which is what is described in the scenario.

Question 8

Which of the following is an example of a tying agreement?

Accepted Answer

A tying agreement occurs when a seller requires the buyer to purchase a second product as a condition of buying a desired product. In option B, Nature's Survival Store must carry an unsuccessful product to sell a successful one, which is a classic example of a tying agreement.

Question 9

_____ is the view that ethical standards in one's home country should be applied to one's behavior across the world.

Accepted Answer

The view that ethical standards in one's home country should be applied to one's behavior across the world is known as ethical imperialism. This approach assumes that one culture's ethical standards are superior to others and should be imposed on others, regardless of their respective cultural norms and values.

Question 10

Which of the following is an example of reciprocity?

Accepted Answer

Reciprocity involves the exchange of value or benefits between two parties, often in a mutually beneficial way. In this scenario, Larry's Uniform Company agrees to buy Harry's landscaping services if Harry will rent its uniforms from Larry, which is an example of reciprocity. A, C, D, and E are not examples of reciprocity but rather involve unethical or non-mutually beneficial behavior.

Question 11

In Canada,where puffery is more closely monitored than in the United States,a salesperson told a customer a particular oven would cook meat better than any other oven in the market.The salesperson might be guilty of violating the:

Accepted Answer

The credulous person standard in Canada is a legal test used to determine whether advertising is misleading by considering how it would be understood by a "credulous and inexperienced" consumer. The salesperson's claim about the oven could be seen as an unsubstantiated assertion that might mislead a credulous consumer, potentially violating this standard.

Question 12

_____ is the view that no culture's ethics are superior to any other culture's ethics.

Accepted Answer

Cultural relativism is the view that no culture's ethics are superior to any other culture's ethics because each culture has its own unique set of values and beliefs that should be respected. It is an important concept in anthropology and sociology, providing a framework for understanding cultural diversity and promoting cross-cultural awareness and tolerance. Ethical imperialism (A) and cultural imperialism (B) suggest that one culture's ethics or practices should be imposed upon or dominate another culture, which can lead to cultural homogenization and loss of diversity. Ethical solidarity (C) and cultural solidarity (E) emphasize the common values and interests shared among different cultures, but do not necessarily reject the idea of cultural relativism.

Question 13

When a perfume manufacturer establishes a minimum price below which a retailer may not sell its perfume,the manufacturer is engaged in:

Accepted Answer

Resale price maintenance occurs when a manufacturer establishes a minimum price below which a retailer may not sell its products. It is a form of price fixing that is illegal in some jurisdictions.

Question 14

The manufacturer of Kingston freestanding greenhouses gives $100 as an incentive to a reseller's salespeople for each greenhouse they sell.This special incentive is known as:

Accepted Answer

The special incentive given to reseller's salespeople for each greenhouse they sell is known as a spiff.

Question 15

Robin is selling a Local Area Network (LAN)system to a company that oversees the renovation of dingy,old downtown districts into attractive,shopping areas.Which of the following statements by the seller might be construed as an expressed warranty?

Accepted Answer

The statement "Don't worry if it breaks down; our service people will be able to get it running again quickly" can be interpreted as an expressed warranty because it implies that the seller is guaranteeing that the LAN system will be repaired quickly if it breaks down. This statement goes beyond simply providing information or making a recommendation, which are not considered warranties.

Question 16

To speed up the opening of a new factory in a Middle Eastern country,Micah gifted a pen and pencil set that he had purchased for $10 to an assistant of a local government.Micah hoped this gift would remove some of the red tape that was slowing down the building process.This type of gift is referred to as:

Accepted Answer

This type of gift is referred to as "lubrication," which is a common practice in some countries to expedite processes and remove bureaucratic obstacles. It is not considered legal in many other countries and can be seen as a form of bribery.

Question 17

_____ involves paying large sums of money to higher-ranking officials to get them to do something illegal or to ignore an illegal act.

Accepted Answer

The answer of _____ involves paying large sums of money...

Question 18

Which of the following statements about U.S.salespeople who sell to international customers is true?

Accepted Answer

U.S. salespeople are prohibited from engaging in activities that would adversely affect the U.S. economy.

Question 19

When a department store clerk tells Hilda that the coffee brewed by one particular coffee maker will make her think she has died and has gone to Starbucks heaven,the clerk is using:

Accepted Answer

Puffery is a common practice used in advertising and sales where exaggerated claims or general subjective opinions are made about a product or service without the intention of misleading consumers. In this case, the clerk's statement is more of an exaggeration to make the coffee maker sound more desirable, rather than an intentional misrepresentation of the product.

Question 20

If the salesperson for a paint manufacturer promised a purchasing agent that a certain brand of paint was mildew-resistant (when it was not),the salesperson:

Accepted Answer

The salesperson gave an expressed warranty by promising that the paint was mildew-resistant. An expressed warranty is a guarantee made by the seller about the quality or performance of a product. In this case, the promise of mildew-resistance was not true, making it a wrongful act.

Quiz 2: Ethical and Legal Issues in Selling