Question 1

Ad substantiation,as required by an FTC policy statement,requires a company to have a reasonable basis for its claims at the time it makes the claims.

Accepted Answer

A) True 
 B)False  True

Question 2

The FTC remedy of "affirmative disclosure" would require:

Accepted Answer

A)  a new ad that admits the first ad was false. 
B)  providing certain information in a company's ads. 
C)  that the advertiser desist from deception in all products it markets. 
D)  All of these would be required. 
A)  a new ad that admits the first ad was false. 
B)  providing certain information in a company's ads. 
C)  that the advertiser desist from deception in all products it markets. 
D)  All of these would be required. B

Question 3

The ____ is empowered to issue industry-wide safety standards for consumer products.

Accepted Answer

A)  UCCC 
B)  RESPA 
C)  FCCPA 
D)  CPSC 
A)  UCCC 
B)  RESPA 
C)  FCCPA 
D)  CPSC D

Question 4

Since 1981,the Consumer Product Safety Commission has relied primarily on mandatory safety standards.

Accepted Answer

A) True 
 B)False

Question 5

The Truth-in-Lending Act:

Accepted Answer

A)  applies only to such lenders as banks and savings and loans. 
B)  protects individuals who receive loans for more than $25,000,except for home mortgage loans. 
C)  is regulated by the FTC and the Federal Reserve Board under Regulation Z. 
D)  allows a buyer who is financing his home with a first mortgage to rescind that transaction within three days. 
A)  applies only to such lenders as banks and savings and loans. 
B)  protects individuals who receive loans for more than $25,000,except for home mortgage loans. 
C)  is regulated by the FTC and the Federal Reserve Board under Regulation Z. 
D)  allows a buyer who is financing his home with a first mortgage to rescind that transaction within three days.

Question 6

If the FTC rules that a seller has made a false or deceptive advertising statement,the Commission:

Accepted Answer

A)  has no power to address the practice. 
B)  can require the seller to make additional advertisements to correct it. 
C)  can require the company to go out of business. 
D)  can report the company to the President of the United States for deregulation. 
A)  has no power to address the practice. 
B)  can require the seller to make additional advertisements to correct it. 
C)  can require the company to go out of business. 
D)  can report the company to the President of the United States for deregulation.

Question 7

Ellen,age 25,was recently divorced and has applied to Mayberry Bank for a loan.The bank,as regulated by the Equal Credit Opportunity Act:

Accepted Answer

A)  can ask her if she is married. 
B)  can ask her if she plans to have children soon. 
C)  can discount her loan rating because she is 25 and likely to have children within the next five years. 
D)  must notify Ellen within 30 days after receiving her credit application of the action taken,and if she is denied credit,the bank must give her specific reasons for the denial. 
A)  can ask her if she is married. 
B)  can ask her if she plans to have children soon. 
C)  can discount her loan rating because she is 25 and likely to have children within the next five years. 
D)  must notify Ellen within 30 days after receiving her credit application of the action taken,and if she is denied credit,the bank must give her specific reasons for the denial.

Question 8

The Magnuson-Moss Warranty Act contains disclosure and labeling requirements for sellers of consumer products containing a written warranty.

Accepted Answer

A) True 
 B)False

Question 9

The Truth-in-Lending Act would not require disclosure of the amount that would be due if the borrower had paid cash instead.

Accepted Answer

A) True 
 B)False

Question 10

In order for advertising to be found deceptive by the FTC,it is necessary that:

Accepted Answer

A)  the advertisement can only be reasonably interpreted in one way,and in that way,it is misleading. 
B)  there is a misrepresentation,omission,or practice that is likely to mislead the consumer acting reasonably in the circumstances,to the consumer's detriment. 
C)  the sellers have malice or evil intent. 
D)  something affirmative was said which was misleading;i.e. ,an omission cannot be deceptive. 
A)  the advertisement can only be reasonably interpreted in one way,and in that way,it is misleading. 
B)  there is a misrepresentation,omission,or practice that is likely to mislead the consumer acting reasonably in the circumstances,to the consumer's detriment. 
C)  the sellers have malice or evil intent. 
D)  something affirmative was said which was misleading;i.e. ,an omission cannot be deceptive.

Question 11

Federal regulation prohibits a credit seller or lender from obtaining a nonpossessory security interest in household goods if the interest is not a purchase money security interest.

Accepted Answer

A) True 
 B)False

Question 12

Patricia,who is married to Dustin,applies for a credit card from Vankirk's Department Store,but she is turned down because she is a married woman and the store's policy is to issue cards only in the name of the husband in such situations.What are her legal rights in this situation?

Accepted Answer

Under the Equal Credit Opportunity Act,P

Question 13

There is a federal uniform lemon law that applies across the states to protect consumers in their purchase of new cars.

Accepted Answer

A) True 
 B)False

Question 14

A collection agency may personally contact the debtor even if the debtor has engaged a lawyer to represent him.

Accepted Answer

A) True 
 B)False

Question 15

The FTC policy statement addressing the meaning of unfairness provides that an injury is unfair if it is:

Accepted Answer

A)  likely to mislead the consumer. 
B)  substantial and not outweighed by any benefits to consumers or competition. 
C)  one that the seller could reasonably have avoided. 
D)  All of these. 
A)  likely to mislead the consumer. 
B)  substantial and not outweighed by any benefits to consumers or competition. 
C)  one that the seller could reasonably have avoided. 
D)  All of these.

Question 16

The Fair Debt Collection Practices Act prohibits:

Accepted Answer

A)  communication with a debtor who is represented by an attorney. 
B)  calls after 6 p.m. 
C)  contacting third persons to find out the whereabouts of a debtor. 
D)  a creditor from calling a debtor regarding payment of a bill. 
A)  communication with a debtor who is represented by an attorney. 
B)  calls after 6 p.m. 
C)  contacting third persons to find out the whereabouts of a debtor. 
D)  a creditor from calling a debtor regarding payment of a bill.

Question 17

A description of the finance charges that said "1.8% per month compounded daily" would comply with the rules of the Truth-in-Lending Act.

Accepted Answer

A) True 
 B)False

Question 18

The Magnuson-Moss Warranty Act provides that:

Accepted Answer

A)  a full warranty cannot disclaim any implied warranty. 
B)  a limited warranty can disclaim any implied warranty. 
C)  a full warranty cannot disclaim,but may modify or limit an implied warranty. 
D)  a limited warranty cannot limit the duration of any implied warranty 
A)  a full warranty cannot disclaim any implied warranty. 
B)  a limited warranty can disclaim any implied warranty. 
C)  a full warranty cannot disclaim,but may modify or limit an implied warranty. 
D)  a limited warranty cannot limit the duration of any implied warranty

Question 19

A cease and desist order,issued by the FTC,directs a party to stop a certain practice or face punishment,such as a fine.

Accepted Answer

A) True 
 B)False

Question 20

In order to violate the FTC rules on advertising,a product would have to be affirmatively mislabeled.

Accepted Answer

A) True 
 B)False

Exam 41: Consumer Protection Double

Ad substantiation,as required by an FTC policy statement,requires a company to have a reasonable basis for its claims at the time it makes the claims.

The FTC remedy of "affirmative disclosure" would require:

The ____ is empowered to issue industry-wide safety standards for consumer products.

Since 1981,the Consumer Product Safety Commission has relied primarily on mandatory safety standards.

The Truth-in-Lending Act:

If the FTC rules that a seller has made a false or deceptive advertising statement,the Commission:

Ellen,age 25,was recently divorced and has applied to Mayberry Bank for a loan.The bank,as regulated by the Equal Credit Opportunity Act:

The Magnuson-Moss Warranty Act contains disclosure and labeling requirements for sellers of consumer products containing a written warranty.

The Truth-in-Lending Act would not require disclosure of the amount that would be due if the borrower had paid cash instead.

In order for advertising to be found deceptive by the FTC,it is necessary that:

Federal regulation prohibits a credit seller or lender from obtaining a nonpossessory security interest in household goods if the interest is not a purchase money security interest.

Patricia,who is married to Dustin,applies for a credit card from Vankirk's Department Store,but she is turned down because she is a married woman and the store's policy is to issue cards only in the name of the husband in such situations.What are her legal rights in this situation?

There is a federal uniform lemon law that applies across the states to protect consumers in their purchase of new cars.

A collection agency may personally contact the debtor even if the debtor has engaged a lawyer to represent him.

The FTC policy statement addressing the meaning of unfairness provides that an injury is unfair if it is:

The Fair Debt Collection Practices Act prohibits:

A description of the finance charges that said "1.8% per month compounded daily" would comply with the rules of the Truth-in-Lending Act.

The Magnuson-Moss Warranty Act provides that:

A cease and desist order,issued by the FTC,directs a party to stop a certain practice or face punishment,such as a fine.

In order to violate the FTC rules on advertising,a product would have to be affirmatively mislabeled.

Introduction to Law

Business Ethics and the Social Responsibility of Business

Civil Dispute Resolution

Constitutional Law

Administrative Law

A: Administrative Law

Criminal Law

Intentional Torts

Negligence and Strict Liability

Introduction to Contracts

Mutual Assent

Conduct Invalidating Assent

Consideration

Illegal Bargains

Contractual Capacity

Contracts in Writing

Third Parties to Contracts

Performance,breach,and Discharge

Contract Remedies

Relationship of Principal and Agent

Relationship With Third Parties

Introduction to Sales and Leases

Performance

Transfer of Title and Risk of Loss

Products Liability: Warranties and Strict Liability in Tort

Sales Remedies

Form and Content

Transfer and Holder in Due Course

Liability of Parties

Bank Deposits,collections,and Funds Transfers

Formation and Internal Relations of General Partnerships

Operation and Dissolution of General Partnerships

Limited Partnerships and Limited Liability Companies

Nature,formation,and Powers

Financial Structure

Management Structure

Fundamental Changes

Secured Transactions and Suretyship

Bankruptcy

Protection of Intellectual Property

Antitrust

Employment Law

Securities Regulation

Accountants Legal Liability

Environmental Law

International Business Law

Introduction to Property,property Insurance,bailments,and Documents of Title

Interests in Real Property

Transfer and Control of Real Property

Trusts and Decedents Estates

Legal Terminology: Understanding Criminal and Civil Law Systems

Contract Law Terminology

Exploring the Legal Concepts of Agency and Fiduciary Duty

Understanding Key Legal Concepts in Sales and Contracts

Understanding the Terminology of Banking and Finance: Key Concepts and Definitions

Exploring Legal Concepts and Processes in Business Partnerships

Understanding Corporate Law: A Guide to Ultra Vires Acts, Subscribers, Debt Securities, and More

Understanding Key Terms in Secured Transactions and Bankruptcy Law

Legal Topics and Terms