Contracts
Define "Contract"
A legal agreement between 2 or more people to exchange something of value
Define Warranty
A warranty is a promise or guarantee made by a seller about the quality or performance of their goods
Which type of account holds money that can be immediately used for purchases? (credit or debit)
Debit
TRUE OR FALSE: Door-to-door sales are legal
True (but very annoying)
Define advertisement
A notice or announcement promoting something to the general public (products, political opinions, job openings, etc)
For a verbal contract to be legally binding, a 3rd party has to serve as a __________
Whitness
What sorts of things to people usually get loans for? (name 3)
Houses, cars, school, starting businesses, vacations, hospital stays, furniture, etc.
Name something its illegal for a telemarketer to do
Call at odd hours
Keep calling after you ask them to quit
Not share who they are / who they work for
Not share the total final price
Lie
To make sure they get the best deals, consumers should ______ different ______
Compare different stores/products
Define Contract Fraud
intentionally misrepresenting facts to trick someone into entering a contract or to gain an unfair advantage
Sellers may not lie about their products, but they are able to ___________ their effectiveness
Exaggerate
What happens when someone defaults on a load?
The debt disappears, but their credit score takes a serious hit, meaning they wont be able to borrow money for a while
What is the name of the 3-day period before a door-to-door sale contract can be signed
the 3-day "cooling off" period
What is the advertising appeal that relies on something being popular
Bandwagon
What are the 4 elements of contracts
Offer, Rewards, Punishments, Legality
Define disclaimer and give an example
A formal statement saying that you are not legally responsible for something. Skydiving company disclaimer, medical advice disclaimer, "no warranty" disclaimer
How do banks & lenders make money?
Interest/APR/service charges. They let people borrow money and charge a small % extra for the service.
How does the "bait and switch" tactic work?
Promote a good sale or deal and then take it away at the very end of the deal. Consumers will likely just buy anyway since they've put in so much time
What is the job of the FTC (fair trade comission)
Break up companies that get too big to make sure other companies are able to compete
What 3 things CANNOT be done via oral contract?
Real estate sales, services that take more than a year, anything over 500$ in value
What 5 things are given in a full warranty?
Repair/replace defective product at no cost
No unreasonable obligation on consumer
Fixed within a reasonable time
Fixed after reasonable number of attempts
Applies to all owners during warranty period
What is the difference between secured and unsecured credit?
Secured credit is backed up with property as collateral (you lose your house / car if you fail to pay) and unsecured is not backed up by anything.
Why should consumers wait a few days to buy again after placing an online order
It might take a few days for your bank total to update in your account, making it easy to spend way more than intended.
What are the most effective types of Direct Action
Boycotts, Lawsuits, and Picketing. Anything that makes a company lose money or lose reputation