It enforces the laws that prohibit business practices that are anticompetitive, deceptive or unfair to consumers, and it seeks to do so without impeding legitimate business activity. Magazines -medical underwriting, claims payable to a disability income insured, even when the insured can continue to work, are the result of a B. A. Corrective advertising Which of the following statements about self - regulation by media is true? These are the probabilities that he drives each of the other cars the next day: Pr(\operatorname{Pr}(Pr( Ford after Audi )=0.7Pr(VW)=0.7 \quad \operatorname{Pr}(\mathrm{VW})=0.7Pr(VW after Audi )=0.3)=0.3)=0.3 National Advertising Review Board Advertising by professionals (attorneys and physicians) may be regulated in a more restrictive fashion. 2. A. Law of Agency The National Advertising Division and the Child Advertising Review Unit, divisions within the Better Business Bureau, are the primary agents for this self-regulation. Self-regulation by the advertising industry has increased in recent years, especially with the growth of comparative advertising. Information Technology The law also gave the agency important new power. The U.S. Supreme Court turned back a challenge to the appellate court's ruling, thus bringing an end (at least for the time being) to telemarketers' efforts to invoke free speech arguments to have the popular ban on unwanted phone solicitations declared unconstitutional. Ch 20 Flashcards | Quizlet D. Affirmative disclosure B. superiority advocacy. The _____________________________ is why commercial speech gets First Amendment protection (in chapter 2), ____________________ in _______ - made it a misdemeanor for a publication for advertising for an abortion (a weekly magazine gave a doctor's name to schedule an abortion A. II. Two divisions of the Better Business Bureau's National Advertising Review Council that provide advice to advertisers: reviews national advertising for truthfulness and accuracy, and it provides a form of alternative dispute resolution for companies that is cheaper than litigation, evaluates child-directed advertising and promotional material in all media to advance truthfulness, accuracy, and consistency with its "Self-Regulatory Guidelines for Children's Advertising" and relevant laws, a variety of federal agencies are empowered to enforce consumer protection laws; FTC and FDA, the primary agent of the govt; nearly 100 years old; it polices unfair methods of business competition and protects consumers from deceptive advertising, responsible for protecting public health and ensuring that products like cosmetics, drugs and food are honestly and accurately represented to the public. a life insurance policy written on one contract for two people in which it is payable upon the first death is called.. The Better Business Bureau guidelines C. Federal Communications Commission Unfairness Most states today have such laws. -Guides and the Child Online Privacy Protection Act Advertisers are often supportive of voluntary self-regulation because: A. self-regulation is viewed as a way of limiting government interference of advertising. When the FTC issues a consent order on a final basis, it carries the force of law with respect to future actions. The government's interest in reducing the amount of alcohol consumed by young people is a laudable goal, a unanimous Supreme Court said, but added that there is really no evidence this rule advances the goal. In addition, many states have what are called unfair and deceptive acts and practices statutes, which give consumers the right to seek a judicial remedy in false advertising cases. * In 2009 the FTC banned so-called robocalls (those annoying prerecorded commercial telemarketing calls to consumers) unless the telemarketing company has obtained written permission from a consumer to receive such calls. C. consumers recognize puffery and don't believe it. A. uses puffery. The 3rd section of the law gave the FTC the right to sue in federal court on behalf of consumers victimized by practices that are in violation of a cease and desist order or by practices that are in violation of a TRR, a right that the agency has been reluctant to use. Falsely implying that a test is scientifically conducted. Sellers and telemarketers that transmit such messages to consumers that haven't granted permission to accept them face penalties of up to $16,000 per call. Instead, the FTC enforces the law, with help from the Justice Department and the FBI. The division of Consumer Protection B. Lanham _______________________: Commercial e-mail messages that include "materially false or misleading" header information or deceptive subject lines are prohibited. Ticketmaster and its affiliates agreed to refund some concertgoers to settle FTC charges that they used deceptive bait-and-awitch tacts to sell tickets. D. Most media accept any advertising they receive since advertising is their major source of revenue. A. cease-and-desist order These claims can be viewed as deceptive under the FTC's requirement of: National Advertising Division -commissioner's name, the new jersey life and health guaranty association protects life insurance death benefit claims up to.. SUMMARY: *Recently some consumer class-action lawsuits have netted huge settlements.*. E. advertisers, government, and the television networks. Harry Nims, a New York lawyer, drafted a model law called the *Printers' Ink statute+ (it was Printers' Ink magazine that urged passage of the law) in 1911. C. is important to consumer and would likely have an effect on the purchase decision. The students had a right, in other words, to not speak. C. National Advertising Review Council At this point either side can appeal to the commissioners to overturn the ruling of the judge. 5. Although $1 taken alone may seem small for each sale, the program has collevted more than $1 billion since 1988. The most commonly used FTC remedy is the consent agreement, or _____________________________. -lengthy elimination period, premium mode is a term used to describe the Advertising must be truthful and not misleading, with misleading ads sweeping up those in which relevant information is omitted, those that imply something that's not true and those in which any disclaimers or disclosures are not clear and not prominent enough for reasonable consumers to see, hear and understand them. If either of the last two events occur, a complaint is issued against the advertiser and a hearing is scheduled before an administrative law judge. D. affirmative disclosure order D. Robinson Patman Act C. The media can refuse to accept individual ads they find offensive or objectionable. A. misleading omission The FTC enforces rules regarding endorsements of products and services by consumers, celebrities, experts and organizations. D. Department of the Interior (DOI) C. Bureau of Alcohol, Tobacco and Firearms. *Attorneys for the FTC can seek these restraining orders in federal court. The advertiser may appeal this decision in a federal court. a policy-owner can receive an immediate payment before the insured dies by using a(n) which of the following are retained at the expenses of an insurance buyer to give advice on insurance needed by the buyer? If an advertiser refuses to comply with rulings made by the National Advertising Review Board (NARB), the NARB is most likely to: additional penalties may be applied to those who a) engage in e-mail "harvesting," b) use multiple e-mail accounts for commercial messages, or c) use unauthorized relays for commercial. All commercial e-mail "that includes sexually oriented material" must also include a warning label on the subject line. Does this message injure the plaintiff? 44.1 Advertising, Marketing, and Sales Flashcards | Quizlet Self Regulation by the Advertising Industry, Local Regulation and Better Business Bureau. Marketing Orders SUMMARY: C. Lanham Act If either of the latter two events occur, a complaint is issued against the advertiser, and a hearing is scheduled before an administrative law judge. -$200,000, which of the following actions is REQUIRED by an agent who is replacing an existing life insurance policy? C. ad substantiation agreement CAN-SPAM Act E. a commercial is rejected at the idea generation stage. f(x)=(x5)(12x)f(x)=(x-5)(1-2 x) -terminated employee Several airlines challenged the rule on First Amendment grounds in Spirit Airlines v. U.S. De'p of Transporatition. For instance, in 2012 CARU recommended that the maker of Bratz Party Dolls alter packaging that featured the text "now with 100s of poses" and included photos of 3 dolls posed without assistance in various stances. The most recent commission policy statement on substantiation was issued in 1984. Food and Drug Administration D. Vision Council of America Consent Decrees B. In other words, the creators of ads should be wary of creating false implications. The issue of truth and deception in such ads gained both public and congressional attention in 2008 when Pfizer, Inc. canceled commercials for its Lipitor cholesterol pill that featured Robert Jarvik, an artificial heart pioneer. C. selective retention Implied uniqueness 2. is false or misleading, promotes unlawful goods or services, or is discriminatory on the basis of race. D. Superlatives such as greatest, best, and finest are puffs that are often used in advertising. permitted consumers to sue manufacturers with whom they had no contractual relationships. WebWhich of the following industries are significantly influenced by laws regulating product purity and labeling? B. E. dealt with consumers' rights regarding product warranties. Five commissioners, each of whom is nominated by the president of the U.S. to serve a 7-year term, head the FTC. -Consent agreement An advertiser seeking redress under this federal law can seek to stop the misleading practice and/or win money damages. There is a substantial state interest to justify the regulation. WebThe Telephone Disclosure and Dispute Resolution Act of 1992 requires FTC to promulgate regulations concerning advertising for, operation of, and billing and collection procedures for, pay-per-call or "900 number" telephone services.The regulations must include certain provisions, such as price disclosure requirements, mandatory warnings on services the policy may be paid up early by using policy dividends. [4320]+[wyxz]=[2035]. WebStudy with Quizlet and memorize flashcards containing terms like Consumer protection laws regulate all of the following except: a. unfair trade practices. -conduct investigations Section 43(a) creates a legal cause of action for false advertising. Finally, under the FTC's rules, telemarketers cannot call a person between the hours of 9 P.M. and 8 A.M. unless the person has given prior consent to such late-night, early-morning calls. FTC Definition of False or Deceptive Advertising: General FTC Advertising Rules. Importantly today, the FTC's prohibition against unfair or deceptive advertising and fraudulent marketing in any medium includes the Internet. (you have to scroll down to be able to see it) 48 of those cases were resolved with court orders that cumulatively required payment of nearly $21 million in civil penalties and $12 million in redress or disgorgement of profits. -Maybe 3,000 -Litigated orders Staff attorneys at the FTC will issue a complaint against the advertiser, and a hearing will be held before an administrative law judge. -form a large PPO on a statewide level C. trade allowances A. a consent order. An injunction is clearly a drastic remedy and one that the agency has said it will not use often. In 2010, the FTC went after a high-tech form of bait-and-switch advertising when it settled charges that Ticketmaster and its affiliates used deceptive bait-and-switch tactics to sell concert tickets to consumers. Worked, however, some companies then decided to just merge together. If you go to work at an advertising agency, you must understand that your agency may be held liable if it is an active participant in preparing a deceptive advertisement or if it knows or should know that an ad is either false or lacks substantiation. Central Bank advertises free checking with a minimum balance of $1,000. Which of the following statements about a consent order is true? A very frustrating, and often expensive, scenario for both an agency and its client occurs when: -method of payment US Postal Service (USPS) Responsible for regulating direct mail advertising and BBB stands for: Better Business Bureaus provide control over advertising practices at a _____ level while the Council of Better Business Bureaus plays a major role in controlling advertising practices at a(n) _____ level. 1) Federal Trade Commission (FTC) (most active) controls unfair methods of B. False. Under this policy, express substantiation claims, such as "doctors recommend" and "specific tests prove," require the level of proof advertised. In 1995, the Federal Trade Commission issued a complaint against the manufacturers of New Balance and Saucony athletic shoes based on their "Made in the USA" advertising claims. D. puffery is illegal. The government had specifically limited the reach of the National Do Not Call Registry, which already had more than 50 million phone numbers by the time the appellate court issued its February 2004 opinion, only to telemarketing calls made by or on behalf of sellers of goods or services, and not to charitable or political fund-raising calls. Laws must be static and unyielding in order to provide stability for a society. -What's happening now needs to stop immediately C. American Association of Advertising Agencies FINAL EXAM (first 50) Flashcards | Quizlet D. before the ad appears. Guides and the Child Online Privacy : The FTC 's rules state, among other things, the following: C. Puffery legitimization These guidelines spring from a variety of concerns. But practically, it can regulate almost all advertising. D. Presence of puffery in the advertisement B. -Voluntary compliance -Corrective Advertising Web1) advertising must be truth and not misleading, with misleading ads sweeping up those in which relevant info is omitted, those that imply something that's not true and those in If the NAD and an advertiser fail to resolve an advertising controversy, either party can appeal the case to the NARB. -indemnity If this happens the order is published and made final in 60 days. Advertising ______________________________________: All commercial e-mail messages must contain either a functioning return address or an Internet-based reply "opt-out" mechanism for at least 30 days after transmission of a message. 6. C. Newspapers -waiver of premium Chapter 15- Regulation of Advertising Flashcards | Quizlet Its cost of goods sold is 75 percent of sales, and it finances working capital with bank loans at an 8 percent rate. B. Quizlet -home address The appellate court, however, rejected the unerinclusiveness argument, writing that "First Amendment challenges based on under inclusiveness face an uphill battle in the commercial specs context. -Lawyers are only allowed to state past facts, they can't promise future things Policies and procedures for self-regulation of advertising industry are established by the ____. C. Godiva claims that it makes the finest chocolates in the world. The federal law that made this suit possible was the _____ Act. Injunctions Does this message injure the plaintiff? C. puffery legitimization B. Implied uniqueness The representation, omission or practice must be material. * The hearing is a lot like a trial, only more informal. Module 13 Learn Smart Flashcards | Quizlet C. not requiring consumers to make a purchase as a condition for entering. _____ are industry-wide rules used by the Federal Trade Commission that define unfair or deceptive practices. A. employment, national security, and trade. D. Electronic Retailing Self-Regulation Program (ERSP). Corrective Advertising Federal Communications Commission. Self-regulation begins with the interaction of client and agency when: D. creative ideas are generated and submitted for consideration. The case goes to an appellate court, and there is no new finding of fact: What the FTC says is fact, is fact. Don't press 1 to speak to a live operator and don't press any other number to get your number off the list. -jurisdiction is not particularly limited Robocalls are illegal even if the number dialed is not on the Do Not Call Registry. WebA) It is effective in situations in which competitors are able to undercut prices easily. Newspapers, magazines, broadcasting stations, online service providers and other mass media all have rules that regulate the kind of advertising they carry. Department of Justice (DOJ) To be deceptive an advertisement must contain a representation, omission or practice that is likely to mislead the consumer, the advertisement or practice must be considered from the perspective of a reasonable consumer; and the representation, omission or practice must be material. all commercial e-mails must disclose a) it is an advertisement or solicitation, b) an opt-out mechanism, and c) a "valid physical postal address.". an insurance company needs to obtain personal information from a third party concerning an applicant. D. Distilled Spirits Council. -human resource department It is very expensive to get a case solved through NARC. When the FTC recovers money against a company for false or misleading advertisements, who gets to keep it? E. puffery. ) *3. Again, this law provides little relief for consumers. D. advertisers, agencies, and the media. D. Superlatives such as greatest, best, and finest are puffs that are often used in advertising. D. Sherman Antitrust Act The court thus ruled in favor of the federal beef promotion program and its compelled subsidization of advertising to which some cattle ranchers aand farmers object. these rights are called The regulation of deceptive or untruthful advertising is a large and difficult task policed by the advertising industry itself, the mass media and various governmental agencies. WebEach order and agreement is tailored to the individual industrys needs. The _____ was formed by three advertising associations and the Council of Better Business Bureaus to sustain high standards of truth, accuracy, morality and social responsibility in national advertising. Is it a violation of the First Amendment for a newspaper, magazine or broacdcasting station to refuse to carry an advertisement? A. -partially insured What is the role of the leader and follower in the leadership process? -person's hire date Q. Each violation of such an order may result in a civil penalty of up to $16,000. This provision of the Lanham Act was seldom used by advertisers until the 1970s. In this case the commission can issue an order, usually called a *litigated order,* to stop the particular advertising claim. -There was no substantial state interest. Consent agreement E. Consent orders lead to excessive adverse publicity. Pr(\operatorname{Pr}(Pr( Audi after VW) =0.8Pr(=0.8 \quad \operatorname{Pr}(=0.8Pr( Ford after VW)=0.2\mathrm{VW})=0.2VW)=0.2. A. Wheeler-Lea Amendment C. is important to consumer and would likely have an effect on the purchase decision. this false statement is considered A. E. speech governed by the First Amendment to the U.S. Constitution. food and pharmaceuticals Which promotional strategy requires a 8. WebUnder the law, claims in advertisements must be truthful, cannot be deceptive or unfair, and must be evidence-based. -guaranteed benefit D. Advertising deregulation all commercial e-mail messages must contain either a functioning return e-mail address or an "opt-out" mechanism. B. C. Department of Commerce (DOC) E. Independent Business Alliance, D. Electronic Retailing Self-Regulation Program. -statements that dividends are not guaranteed Between 1946 and 1968 the courts heard fewer than 30 false advertising cases. Advertisers don't like the publicity that accompanies a charge of false advertising. B. premiums -is only available to insurance companies In particular, Johanns v. Livestock Marketing Association centered on a federal statute and related order adopted in the 1980s under which the U.S. secretary of agriculture imposes a $1-per-head assessment, knwn as a checkoff, on all sales of cattle in the U.S. D. an advertisement has the potential to mislead an unsophisticated consumer. WebAdvertising regulations exist in order to Demonstrate full and truthful disclosures to the public The purpose of Advertising regulations is to assure full and truthful disclosures to C. Wheeler Lea Amendment to the FTC Act Misleading comparative claims. The new law expanded the jurisdiction to practice "affecting commerce." A. exchange D. The division of Advertising Practices Local radio E. Advertising substantiation. Telephone Consumer Protection Act of 1991. -premium past due -The size of damage awards skyrocketed. B. Lanham Act WebAn orgnaization established and funded by businesses that operate primarily at the local level to monitor activities of companies andp promote fair advertising and selling Federal Trade Commission. Since advertising campaigns are ephemeral , the FTC often has difficulty in catching up with the advertiser before the short-lived campaign has been replaced with something else. A. U.S. Pr(\operatorname{Pr}(Pr( Audi after Ford )=0.6Pr(VW)=0.6 \quad \operatorname{Pr}(\mathrm{VW})=0.6Pr(VW after Ford )=0.4)=0.4)=0.4 Federal Trade Commission A. unsolicited order Which type of life insurance policy is this? FTC Tools or Remedies to Stop False Advertising: WebTerms in this set (100) Advertisers are often supportive of voluntary self-regulation because: s self-regulation is viewed as a way of limiting government interference of advertising. 3. what kind of rider is this? The advertiser admits no wrongdoing by signing such an order, so there is no liability involved. The Federal Trade Commission may require affirmative disclosure if: There must be a representation, omission or practice that is likely to mislead or to confuse the consumer. -$400,000 A. U.S. Court of Appeals can review all commission order.s -beneficiaries He drives every day and never drives the same car two days in a row. 1. E. is experiencing a tightening of the rules concerning the rating system used for commercials. C. The division of Marketing Practices Bad publicity can cost a company millions of dollars. FTC initiated this in 2003 that allows people to block the calls of telemarketers. E. The four major television networks. ) B. adopted to stop unfair competition in the marketplace; section 43A creates a legal cause of action for false advertising, allowing for federal civil lawsuits based upon false advertising and endorsements. Three major divisions of the Federal Trade Commission are the Bureaus of: Webset criteria of regulating advertising. 17. E. Advertising guidelines, According to Federal Trade Commission policy, the criteria for determining _____ are (1) a trade practice causes substantial physical or economic injury to consumers, (2) could be reasonably avoided by consumers, and (3) it must not be outweighed by countervailing benefits to consumers or competition. The basic defense against any false advertising complaint is truththat is, proving that a product does what the advertiser claims it does that it is made where the advertiser says it is made, or that it is as beneficial is it is advertised to be. E. selective disclosure, As per FTC, _____ occurs when qualifying information necessary to prevent a practice, claim, representation, or reasonable belief from being misleading is not disclosed. National Association of Broadcasters A. ad substantiation has been proven unnecessary as long as the advertising industry is self-regulating. -Advertising, as a part of the marketing mix for all products, took on more importance in the past 50 years. B. Solve the present value formula (5) for nnn. Corrective advertising, in which an advertiser must admit in future advertisements that past advertisements have been incorrect Which of the following statements describes the media's role in the self-regulation of advertising? If a case is not resolved to its satisfaction, the NARB has the power to order an advertiser to stop running its ads. E. Central Hudson Test, Federal regulation of advertising originated in 1914 with the passage of the _____ Act. D. advertisers who want to use misleading wording in their ads. E. can be substantiated. E. Freedom of press. C. Affirmative Disclosure D. California Test of Affirmation National Advertising Review Board \end{array}\right]+\left[\begin{array}{ll} The registry, however, would also prove controversial. The 5 members of the commission are appointed by the president and confirmed by the Senate for a term of 7 years. A. cease-and-desist. In 2008 the FTC clarified that the "valid physical postal address" that must be disclosed by the sender of commercial e-mail messages can be either a registered post office box or a private mailbox established under U.S. Also, advertising aimed at a special vocational group, such as physicians, will be evaluated from the perspective of a reasonable member of that group. A. D. FDA Act A. previous advertising has led to the formation of false beliefs about a product. D. Food and Drug Administration The advertiser is not responsible for every interpretation or behavior by a consumer.
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