Chp. 44 Consumer & Environmental Law

Multiple Choice
Identify the letter of the choice that best completes the statement or answers the question.

____ 1. Tekno Company's advertisement states that "if you aren't using a Tekno computer, you aren't using the best." The Federal Trade Commission would consider this ad
a. false only.
b. misleading only.
c. false and misleading.
d. none of the above.

____ 2. Handy Hardware advertises rakes at a "Special Low Price of $5.99." When Jill tries to buy one of the rakes, Ken, the salesperson, tells her that they are all sold and no more are obtainable. Ken adds that Handy has other rakes for $12.99. This is
a. a legitimate sales technique.
b. bait-and-switch advertising.
c. counteradvertising.
d. puffery.

____ 3. Home Sales, Inc., uses a prerecorded voice to solicit business from consumers over the telephone. Vera, a consumer, objects to being solicited in this way. If Vera files a suit against Home Sales, she may recover
a. up to treble the amount of any actual monetary loss.
b. up to $500 in damages for each objectionable call.
c. only an injunction against any future calls.
d. none of the above.

____ 4. Consumer Products Corporation puts labels on its products. These labels are subject to federal labeling and packaging rules, which are enforced by the Federal Trade Commission and
a. the Environmental Protection Agency.
b. the U.S. Department of Health and Human Services.
c. the Federal Communications Commission.
d. the Bureau of Alcohol, Tobacco, and Firearms.

____ 5. Ron signs a contract with Sam, a door-to-door salesperson for Tutors, Inc., to buy a foreign-language course. To cancel the contract, Ron has up to
a. three days.
b. thirty days.
c. sixty days.
d. ninety days.

____ 6. Consumer Financial Corporation (CFC) extends credit to consumers. CFC is subject to the Equal Credit Opportunity Act, which prohibits credit discrimination based on
a. educational achievement.
b. income.
c. marital status.
d. unfavorable credit reports.

____ 7. Martha signs an installment contract with Appliance Hut to finance a new TV that she is buying from them for $1,100. This transaction is subject to
a. the Fair Credit Reporting Act.
b. the Telecommunications Act.
c. the Truth-in-Lending Act.
d. none of the above.

____ 8. Ernie borrows $20,000 from First National Bank to renovate his home. This transaction is subject to
a. the Fair Credit Reporting Act.
b. the Real Estate Sales Protection Act.
c. the Truth-in-Lending Act.
d. none of the above.

____ 9. Suzanne buys a car from her friend, Tina, for $6,000 and agrees to make monthly payments of $600 until the price is paid. Suzanne mails the payments to Tina. This transaction is subject to
a. the Fair Credit Reporting Act.
b. the FTC Mail-Order Rule.
c. the Truth-in-Lending Act.
d. none of the above.

____ 10. Bob borrows $5,000 from his credit union to pay for a car he is purchasing. Bob mails the payments to the credit union. This transaction is subject to
a. the Fair Credit Reporting Act.
b. the FTC Mail-Order Rule.
c. the Truth-in-Lending Act.
d. none of the above.

____ 11. Ace Collection Agency harasses and intimidates Jenny in an attempt to collect payment for a shipment of books that Jenny returned to the National Book Sales Company six months previously. This is a violation of
a. the Fair Credit Reporting Act.
b. the Fair Debt Collection Practices Act.
c. the Truth-in-Lending Act.
d. none of the above.

____ 12. When Bruce applies to First State Bank for a credit card, he is denied credit. He can obtain information on his credit history in a credit bureau's files under
a. the Equal Credit Opportunity Act.
b. the Fair Credit Reporting Act.
c. the Fair Debt Collection Practices Act.
d. none of the above.

____ 13. The credit department of Nationwide Department Stores, Inc., frequently calls Maxine at work, even though her employer objects to the calls, about her overdue bill. This is a violation of
a. the Fair Credit Reporting Act.
b. the Fair Debt Collection Practices Act.
c. the Truth-in-Lending Act.
d. none of the above.

____ 14. Friendly Collection Agency calls Calvin several times a day, and sometimes in the middle of the night, about an overdue medical bill that Calvin's doctor turned over to the agency for collection. This is a violation of
a. the Fair Credit Reporting Act.
b. the Fair Debt Collection Practices Act.
c. the Truth-in-Lending Act.
d. none of the above.

____ 15. Excel Furniture Store, from which Frank bought home-office furniture, sends a letter to Frank-who failed to make his scheduled payments for four months-asking for payment for the furniture. This is a violation of
a. the Fair Credit Reporting Act.
b. the Fair Debt Collection Practices Act.
c. the Truth-in-Lending Act.
d. none of the above.

____ 16. National Toy Company makes a toy that the Consumer Product Safety Commission (CPSC) believes to be hazardous. The CPSC may require National Toy to
a. remove the toy from the market.
b. report on any items sold, but not remove the toy from the market.
c. remove the toy from the market and report on any items sold.
d. none of the above.

____ 17. Maria goes to CompuTech, a consumer electronics store in Houston, Texas, to buy a pocket calculator. The salesperson sells her a top-of-the-line computer system, with scanner and color printer, which Maria does not need and cannot afford. This is a violation of
a. the Fair Credit Reporting Act.
b. the Texas Deceptive Trade Practices Act.
c. the Truth-in-Lending Act.
d. none of the above.

____ 18. A group of citizens sues National Manufacturing Company, alleging pollution and injuries from that pollution. If their suit is based on a common-law ground, the citizens may obtain
a. damages only.
b. an injunction only.
c. damages and an injunction.
d. none of the above.

____ 19. Ore Resources, Inc, operates an open-pit mine. Nearby farmers file a suit against Ore Resources, alleging injuries from its operation. The farmers need to show that the business failed to exercise reasonable care if their suit is based on
a. a nuisance theory.
b. a negligence theory.
c. a strict liability theory.
d. all of the above.

____ 20. CompuTex, Inc., operates a silicon chip plant. To be certain that the firm is in compliance with all applicable environmental laws, CompuTex should consult
a. federal, state, and local authorities.
b. federal and state authorities only.
c. federal authorities only.
d. none of the above.

____ 21. Standard Resorts, Inc., wants to build a concession facility at a national park on federal land, which requires the consent of federal agencies. For this action, an environmental impact statement is
a. prohibited.
b. required.
c. unnecessary.
d. voluntary.

____ 22. Pacific Corporation, a private company, wants to build a warehouse on private land. For this action, an environmental impact statement is
a. prohibited.
b. required.
c. unnecessary.
d. voluntary.

____ 23. River Electric Company wants to build a dam as part of a federal project. For this action, an environmental impact statement is
a. prohibited.
b. required.
c. unnecessary.
d. voluntary.

____ 24. Wood Products Corporation's plant is a major source of air pollution. Performance standards for the plant require
a. compliance with specific standards for each pollutant.
b. the use of the best available control technology.
c. the use of the maximum achievable control technology.
d. the use of the most affordable control technology.

____ 25. Ed opens Ed's Dry Cleaning store in a small retail center. Performance standards for Ed's operation, as regards hazardous air pollutants, requires
a. compliance with specific standards for each pollutant.
b. the use of the best available control technology.
c. the use of the maximum achievable control technology.
d. the use of the most affordable control technology.

____ 26. General Construction Corporation wants to develop land that includes an area of wetlands, as the term is defined by the Environmental Protection Agency. To fill or dredge this area requires
a. a contribution to the Natural Resources Defense Fund.
b. a permit from the Army Corps of Engineers.
c. both a and b.
d. none of the above.

____ 27. Consolidated Industries, Inc., operates an oil refinery near Blue River, which flows into Big Lake. Discharging oil from the refinery into the river can result in
a. civil penalties only.
b. damages only.
c. civil penalties and damages.
d. none of the above.

____ 28. Magna Solvents Corporation has waste that it wants to discharge into navigable waters. Under the Clean Water Act, Magna must apply for a permit
a. after discharging waste.
b. before discharging waste.
c. simultaneous with the discharge of waste.
d. none of the above.

____ 29. Under the Marine Protection, Research, and Sanctuaries Act (the Ocean Dumping Act), Bayside Chemical Company may dump its chemical waste into the ocean
a. after obtaining a permit.
b. before obtaining a permit.
c. without a permit.
d. not at all.

____ 30. National Heavy Equipment Company manufactures construction equipment without required noise-control devices, which National maintains interferes with the equipment's efficiency. Distributing these products can result in
a. an injunction only.
b. a criminal fine and imprisonment only.
c. an injunction, a criminal fine, and imprisonment.
d. none of the above.

____ 31. International Chemical Company makes and sells pesticides. For the pesticides to remain on the market, the acceptable level of harm to people from exposure to the products is
a. "a possibility of no harm."
b. "a reasonable certainty of no harm."
c. "a definite certainty of no harm."
d. "no harm."

____ 32. Universal Chemical Company manufactures pesticides and herbicides. These substances are regulated by
a. the Comprehensive Environmental Response, Compensation and Liability Act.
b. the Federal Insecticide, Fungicide, and Rodenticide Act.
c. the Safe Drinking Water Act.
d. the Toxic Substances Control Act.

____ 33. International Agricultural Products manufactures a pesticide that provides a one-in-a-million risk to people of developing cancer from exposure. This substance must be
a. disposed of before anyone develops cancer.
b. registered before it is sold.
c. taken off the market and placed in temporary storage.
d. used only in a way that avoids exposure to people.

____ 34. Under the Resource Conservation and Recovery Act, hazardous waste generated by the Industrial Manufacturing Corporation must be properly labeled and packaged, before being transported, by
a. the Environmental Protection Agency.
b. the Industrial Manufacturing Corporation.
c. the Resource Conservation and Recovery Commission.
d. none of the above.

____ 35. ChemDep, Inc., operates a hazardous waste disposal site, which it uses as collateral to borrow money from First State Bank. The bank does not participate in ChemDep's operation. A release of hazardous chemicals is discovered at the site, and the Environmental Protection Agency (EPA) cleans it up. The EPA can recover the cost of the clean up from
a. ChemDep only.
b. First State Bank only.
c. ChemDep or First State Bank.
d. none of the above.