Question 1

Bea borrows funds from Credit Union to repair her home and to buy a car.She buys a laptop from Discount Store in a transaction financed by the seller.If these parties are subject to the Truth-in-Lending Act,Regulation Z applies to

Accepted Answer

A)  the car loan only. 
B)  the home repair loan only. 
C)  the retail installment sale only. 
D)  the car loan,the home repair loan,and the retail installment sale.

Question 2

Bait-and-switch advertising occurs if the seller fails to have reasonably adequate quantities of the advertised item available.

Accepted Answer

A) True 
 B)False

Question 3

Lu's application to Metro Bank for a credit card is denied.Logan can obtain information on his credit history in a credit agency's files under

Accepted Answer

A)  no federal law. 
B)  the Equal Credit Opportunity Act. 
C)  the Fair Credit Reporting Act. 
D)  the Fair Debt Collection Practices Act.

Question 4

The government cannot remove a product from the market simply because it is considered imminently hazardous.

Accepted Answer

A) True 
 B)False

Question 5

Credit Loan Company extends credit in the ordinary course of its business.Under the Truth-in-Lending Act,Credit Loan must inform potential borrowers of

Accepted Answer

A)  credit terms offered by other lenders. 
B)  comparative prices for goods to be bought with the borrowed funds. 
C)  Credit Loan's credit terms. 
D)  the borrowers' credit scores.

Question 6

The Lanham Act protects against the deceptive use of trademarks but does not cover false advertising claims.

Accepted Answer

A) True 
 B)False

Question 7

Spicy Salsa,Inc. ,complains to the Federal Trade Commission (FTC)about an ad broadcast by Tangy Taco Sauce Company,Spicy's competitor.The FTC investigates and concludes that the ad is deceptive.The FTC's next step is to

Accepted Answer

A)  conduct negotiations between the competitors. 
B)  draft a formal complaint. 
C)  issue a cease-and-desist order. 
D)  permit Spicy to broadcast similarly deceptive counteradvertising.

Question 8

Labels must be accurate and use words easily understood by the ordinary consumer.

Accepted Answer

A) True 
 B)False

Question 9

A consumer may recover under a state consumer-fraud statute,even if he or she has not suffered actual damages proximately caused by a deceptive act.

Accepted Answer

A) True 
 B)False

Question 10

An ad for Bagels Inc.attracts buyers who would otherwise have made purchases from Croissant Company.To bring a successful claim against Bagels Inc.under the federal Lanham Act for false advertising,Croissant must establish that

Accepted Answer

A)  the ad was false or deceptive. 
B)  the buyers were deceived by the ad. 
C)  the ad directly caused Croissant to lose sales. 
D)  all of the choices.

Question 11

Under the Fair Credit Reporting Act,a consumer can request the identity of anyone who has received a credit agency's report on the consumer.

Accepted Answer

A) True 
 B)False

Question 12

Regulation Z was issued by the Federal Reserve Board of Governors to implement the disclosure requirements of the Truth-in-Lending Act.

Accepted Answer

A) True 
 B)False

Exam 21: Consumer Protection

Bea borrows funds from Credit Union to repair her home and to buy a car.She buys a laptop from Discount Store in a transaction financed by the seller.If these parties are subject to the Truth-in-Lending Act,Regulation Z applies to

Bait-and-switch advertising occurs if the seller fails to have reasonably adequate quantities of the advertised item available.

Lu's application to Metro Bank for a credit card is denied.Logan can obtain information on his credit history in a credit agency's files under

The government cannot remove a product from the market simply because it is considered imminently hazardous.

Credit Loan Company extends credit in the ordinary course of its business.Under the Truth-in-Lending Act,Credit Loan must inform potential borrowers of

The Lanham Act protects against the deceptive use of trademarks but does not cover false advertising claims.

Spicy Salsa,Inc. ,complains to the Federal Trade Commission (FTC) about an ad broadcast by Tangy Taco Sauce Company,Spicy's competitor.The FTC investigates and concludes that the ad is deceptive.The FTC's next step is to

Labels must be accurate and use words easily understood by the ordinary consumer.

A consumer may recover under a state consumer-fraud statute,even if he or she has not suffered actual damages proximately caused by a deceptive act.

An ad for Bagels Inc.attracts buyers who would otherwise have made purchases from Croissant Company.To bring a successful claim against Bagels Inc.under the federal Lanham Act for false advertising,Croissant must establish that

Under the Fair Credit Reporting Act,a consumer can request the identity of anyone who has received a credit agency's report on the consumer.

Regulation Z was issued by the Federal Reserve Board of Governors to implement the disclosure requirements of the Truth-in-Lending Act.