Definitions
What type of law is the body of statutes, agency rules, and judicial decisions protecting consumers of goods and services from dangerous manufacturing techniques, mislabeling, unfair credit practices, deceptive advertising, and other such practices?
Consumer Law
What type of advertising is undertaken to correct earlier false claims that were made about a product?
Counter Advertising
Which act created the Federal Trade Commission (FTC) to carry out the broadly stated goal of preventing unfair and deceptive trade practices, including deceptive advertising?
The Federal Trade Commission Act
True or False: State consumer protection laws often provide less significant protections than do federal laws to protect the rights of consumers.
False; the protections are more significant.
What type of advertising misleads consumers, either by making unjustified claims about a product’s performance or by omitting a material fact concerning the product’s composition or performance?
Deceptive Advertising
What type of order involves an administrative or judicial order prohibiting a person or business firm from conducting activities that an agency or court has deemed illegal?
Cease and Desist Order
Which Act prohibits telephone solicitation using an automatic telephone dialing system or a prerecorded voice?
The Telephone Consumer Protection Act
True or False: When it comes to deceptive advertising, vague generalities and obvious exaggerations are permissible.
True; they are called puffery.
What type of laws allow buyers of goods sold in certain transactions to cancel their contracts within three business days?
"Cooling-off" Laws
What type of advertising is when a product is at an attractive price and then tells the consumer that the advertised product is not available or is of poor quality and encouraging her or him to purchase a more expensive item?
Bait-and-Switch Advertising
Which act requires food labels to provide standard nutrition facts and regulates the use of such terms as "fresh" and "low fat"?
The Nutrition Labeling and Education Act
True or False: Advertising that contains an endorsement by a celebrity may be deemed
deceptive if the celebrity does not actually use the product.
True
What is the agency that oversees the credit practices of banks, mortgage lenders, and credit-card companies?
The Consumer Financial Protection Bureau
What type of order requires a firm that has engaged in deceptive advertising to cease and desist from false advertising in regard to all the firm’s products?
Multiple Product Order
Which act protects trademarks and covers false advertising claims?
The Lanham Act
True or False: The FTC does not monitor online advertising for false or deceptive claims for products and services.
False; they do monitor online advertising.
What regulation is a set of rules issued by the Federal Reserve Board of Governors to implement the provisions of the Truth-in-Lending Act?
Regulation Z
Which of these is NOT one of the state laws concerning false advertising?
1. The defendant committed a deceptive or unfair act.
2. The act was committed in the course of trade or commerce.
3. The defendant intended that others rely on the deception.
4. The plaintiff suffered actual damages proximately caused by the deception.
Haha! Trick question, they are all correct!
Which Act states that a lender must disclose all of the following:
• The annual percentage rate (APR)
• The finance charge
• The amount financed
• The total payments (the sum of the amount loaned, plus any fees, finance charges,
and interest)
The Truth-in-Lending Act
True or False: Ads must disclose relevant limitations and qualifying information concerning the claims advertisers are making.
True