advertising regulations exist in order to quizlet

WebAdvertising is not equally productive for firms in every market type. Guides and the Child Online Privacy : -Endorsements must reflect the honest opinions, findings, beliefs or experiences of the endorser and may not contain any representations that owls be deceptive or could not be substantiated if made directly by the advertiser. D. discourage comparative advertising. D. were made legally binding by the Robinson-Patman Act. -the court held it went against First Amendment *A First Amendment right not to be compelled by the government to speak has been recognized by the Supreme Court in some situations. B. Acme's competitors may sue the company under the Lanham Act if it cannot substantiate its claims. The advertiser must have evidence to substantiate its claims if challenged. 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. Food and Drug Administration. If Parramore could lower its inventories and receivables by 10 percent each and increase its payables by 10 percent, all without affecting sales or cost of goods sold, what would be the new CCC, how much cash would be freed up, and how would that affect pretax profits? C. Lanham Act -method of payment The representation, omission or practice must be material. C. Direct Selling Association Act. Information Technology Act (ITA). A. Which type of life insurance policy is this? D. Distilled Spirits Council. Information Technology As with the structure of the Federal Communications Commission described in Chapter 16, no more than 3 of the 5 commissioners can be from the same political party. There must be a representation, omission or practice that is likely to mislead or to confuse the consumer. An entire industry can be treated similarly, and just one or two businesses are not picked out for complaint. WebUnder the law, claims in advertisements must be truthful, cannot be deceptive or unfair, and must be evidence-based. B. Bureau of Economics -if spam has anything to do with sexually explicit, in header, it has to say "SEXUALLY EXPLICIT:" in all caps and you have to scroll down to see the sexual explicit content A. commercial speech. D. Electronic Retailing Self-Regulation Program B. deception If they can find none, the case ends. Another angle that advertisers can pursue is to attack a different aspect go the government's case rather than try to prove the statement true. 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. ____, as defined by the First Amendment to the U.S. Constitution, is the most basic federal law governing advertising in the United States. Legislation is being considered that would either ban or impose major restrictions on A. -existing producers -insured employee To implement this provision, the FTC in 2004 adopted a rule requiring spammers who send sexually oriented material to include the warning "SEXUALLY-EXPLICIT:" in the e-mail subject line or face fines for violations of federal law. -$400,000 The Better Business Bureau guidelines C. Godiva claims that it makes the finest chocolates in the world. To be considered commercial speech, it only has to meet 1 of the 3 questions. The FTC program that requires an advertiser who is found guilty of false or misleading advertising claims to run ads to rectify the situation is known as: -does not include political calls or spam artists B. Litigated Orders and Injunctions: E. an illegal comparative advertisement. B. It also obtained 19 civil penalties in 2012, including $22.5 million from Google, Inc. If you respond by pressing any number, it will probably lead to more robocalls.". In fiscal year 2012, the FTC had more than 1,000 full-time employees and a budget of $313 million. Postal Service. B. D. Advertising deregulation right to transfer ownership and dividend entitlement. -person's health claim Information, Health Chapter 10 Exam - NJ Laws and Rules, Health Policy Provisions, Clauses & Riders, Fundamentals of Financial Management, Concise Edition, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Critical Point Personal hand hygiene, garbing. -CAN-SPAM Act -may cancel the policy only at renewal This is a written agreement between the commission and the advertiser in which the advertiser agrees to refrain from making specific reduct claims in future advertising. E. injunction. Typically the advertising campaign is already over. The problem for Roommates.com was that it solicited specific content from users and forced them to use pull-down menus with questions featuring specific answer options in which they could express illegal and discriminatory views. To avoid having this promotion classified as a lottery, Champion should: B. Robinson Patman Act D. run the promotion only in the state where the Super Bowl is being held. A. ad substantiation D. economics, consumer protection, and competition. Using an ambiguous or easily confused phrase. E. Telephone Consumer Protection Act, ) The Federal Trade Commission and U.S. -insurance company, an insured's status under social security can be described as.. Can the government, in the name of protecting against consumer deception, compel companies to include certain facts in ads they might not otehrwise want to disclose? E. Competitor Trademark Act, Which of the following is used by many states as a basis for their advertising regulations? A. Q. Since the mid-1970s commercial advertising has been given the qualified protection of the First Amendment because much advertising contains information that is valuable to consumers. Will you buy the book? -premium paid, an insurer has the right to recover payment made to the insured from the negligent party. The basis of the program is simple: The commission asks advertisers to substantiate claims made in their advertisements. It is very expensive to get a case solved through NARC. But if time is the greatest enemy, publicity is the FTC's strongest ally. WebStudy with Quizlet and memorize flashcards containing terms like Advertisers are often supportive of voluntary self-regulation because: A. self-regulation is viewed as a way of D. advertising deregulation Laws banning false advertising exist at both the state and local levels, but tend to be applied half-heartedly. False or misleading advertising, as well as advertising about unlawful goods and services receives _______ First Amendment protection. WebAdvertisers are often supportive of voluntary self-regulation because: A. self-regulation is viewed as a way of limiting government interference of advertising. E. advertisers who do not want to be self-regulated. -Ads presenting endorsements by individuals who are represented, either directly or by implication, to be "actual consumers" must use actual consumers, in both the auto and video, or else they must clearly and conspicuously disclose that the people in such ads are not actual consumers of the advertised product. -whether a spokesperson is paid. Postal Service regulations. The act or practice must be considered from the perspective of a consumer who is acting reasonably. B. kid vid National Advertising Division (NAD) and Child Advertising Review Unit (CARU). -person's net income It has its own standards of practice and creative code. The FTC contended that the registry, which is a list containing the personal telephone numbers of telephone subscribers who have voluntarily indicated that they do not wish to receive unsolicited calls from commercial telemarketers, was necessary to reduce both intrusions upon consumer privacy in the home and the risk of fraudulent or abusive solicitations from telemarketers. which law do all insurers and their producers need to comply with? -is only available to insurance companies When an advertisement conveys more than one meaning to a reasonable consumer, one of which is false, the seller is liable for the misleading interpretation. The courts have extended First Amendment protection to: Advertisers claimed the Registry violated their First Amendment rights to free speech. While the front panel of the box showed it contained no trans fat, it failed to include a disclosure statement to alert consumers that the product nonetheless has significant levels of both saturated fat and total fat, thus violating the federal Food, Drug, and Cosmetica Act. III only. B. The TRRs are much broader and make it much harder for advertisers to skirt the limitations. *Accurate information in the text may not remedy a false headline. C. Bureau of Alcohol, Tobacco and Firearms B. implied uniqueness 3. Litigated orders to advertisers to terminate a particular advertising claim, failure to comply with which can result in severe penalty D. economics, consumer protection, and competition, Which division of the Federal Trade Commission would deal with antitrust and consumer protection investigations? -is not available to the public 180 seconds . II. The FTC usually requires an advertiser to substantiate claims that go beyond those permitted by the guides or may even bring a false advertising action against the business. Trade regulation rules that can be issued to regulate advertising throughout an entire industry. C. U.S. B. 3. * -It was easier to block a competitor's claims than to win damages, because in order to gain a monetary award the plaintiff had to show specific monetary loss, something that is often difficult to do given the nebulous nature of advertising claims and the forces that motivate a consumer to buy a specific brand of a product. With the rapid growth of comparative advertising (in which the advertised product is compared to a competitor's product), more and more advertisers have taken competitors to court over what they claim is deceptive and false advertising. B. puffery has detrimental effect on consumers' purchase decisions. advertising regulations exist in order to quizlet. WebRegulates the advertising of securities and the disclosure of information in annual reports. -protections of proceeds against the insured's creditors Although ad agencies and publishers/broadcasters are generally not held liable in cases of false or harmful advertising, there are signs that the law is changing. B. a commercial that was rejected at the storyboard stage is accepted at the final stage. For some specialized products or services, additional rules may apply. -jurisdiction is not particularly limited -fully insured C. U. S. Postal Service D. U.S. Justice Department. Uder the terms of the CAN-SPAM Act, each separate e-mail in violation of the law is subject to penalties of up to $________________, and more than one person may be held responsible for violations. All commercial e-mail "that includes sexually oriented material" must also include a warning label on the subject line. There Central Hudson Businesses must have evidence to back up their claims. C. Council of Better Business Bureaus Federal Trade Commission -policy owners who is able to love and work. E. Clayton Antitrust. 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. A. U.S. In addition to the informal sanction of publicity, the FTC has a wide range of remedies to deal with advertising: 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. Under the watchful eye of the FTC, the following general advertising rules must be followed: Ads must be truthful and non-deceptive. All TV viewers have seen famous athletes and celebrities, as well as experts and ordinary consumers, on commercials making claims abut products they supposedly use or in which they otherwise believe. Advertising claims that significantly involve health and safety are usually presumed to be material. Trading stamps, contests, freebies, premiums and even product labels are included in this definition, in addition to the more common categories of product and service advertising. (you have to scroll down to be able to see it) In other words, the Livestock Marketing Association and the other plaintiff in the case objected to the fact that they were compelled to subsidized speech-the generic beef advertising campaign-to which they objected. But if the commissioners support an administrative law judge's ruling against an advertiser, the order becomes law after it is finalized by an appellate court. B. selective exposure. -administer oaths, which of the following would be considered a possible applicant and contract policy holder for group health benefits? d. requiring an individual, group, or organization to choose among several actions that must be evaluated as right or wrong, ethical or unethical. A. are used to regulate public service announcements. what amount will be paid under a policy where the insured misstated his/her age? B. if the ad does not provide sufficient information to the consumers so as to make an informed decision. Businesses that violate the do-not-call regulations are subject to civil penalties of up to $16,000 per individual violation. * 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. E. Advertisers who do not comply with the NAD/NARB review process will find themselves encumbered with a class action lawsuit. C. affirmative disclosure. National Advertising Review Board _____ are industry-wide rules used by the Federal Trade Commission that define unfair or deceptive practices. E. Treasury Department, Which of the following agencies is responsible for tax collection for the liquor industry? The agency has never outlined a hard-and-fast policy regarding when corrective advertising will be used. E. materiality, Under which of the following FTC programs might a firm be required to have product information verifying the veracity of its advertising claims before making any advertising claims about the product? B. refer the case to an industry trade association. It held that an online roommate-matching service was not immune to liability under Section 230 of the CDA for posting information by others that violated the Fair Housing Act and California housing discrimination laws. 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. -if you're saying something subjective ("old puffery"), you are not likely to get in trouble with the FTC for false advertising, Guides: Between 1946 and 1968 the courts heard fewer than 30 false advertising cases. When the FTC recovers money against a company for false or misleading advertisements, who gets to keep it? *In a nutshell, the FTC's rules against deceptive advertising break down into 2 critical components:* -net death benefit will be reduced if the loan is not repaid A well-educated physician might be better able to understand a complicated pharmaceutical ad than the average individual can. The judge also has the authority to dismiss the case. Advertising by attorneys is legal in the entire United States. -notify the existing insurer of the proposed replacement A. enhance the credibility of the publication. More part of the new law is that the endorsers may also be subject to liability for their statements. Does this message injure the plaintiff? Webadvertising regulations exist in order to? FTC's means to police deceptive advertising, Guides and the Child Online Privacy Protection Act A. ad substantiation has been proven unnecessary as long as the advertising industry is self-regulating. Self-regulation begins with the interaction of client and agency when: D. creative ideas are generated and submitted for consideration. Consent agreement At this point one of three things can happen: A. Distribution . 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 B. Corrective advertising, in which an advertiser must admit in future advertisements that past advertisements have been incorrect -3 & 0 E. can be substantiated. C. National Advertising Review Board -The test of false advertising, for years a complex configuration of criteria, was reduced to basically 3 parts: B. 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. Falsely implying that a test is scientifically conducted. It is difficult for courts to reverse an FTC ruling. Instead, the FTC enforces the law, with help from the Justice Department and the FBI. Writing for a 6-justice majority, Justice Antonin Scalia wrote that "the message set out in the beef promotions is from beginning to end the message established by the Federal Government" and that the secretary of agriculture "exercises final approval authority over every word used in every promotional campaign." A large protion of that money, under the federal Beef Promotion and Research Act, has gone to finance generic advertising for the beef industry, including the "Beef. A. U.S. Court of Appeals can review all commission order.s C. Bureau of Alcohol, Tobacco and Firearms. B. * Competition D. Bureau of Alcohol, Tobacco, and Firearms 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. A. E. if the ad runs for more than six months. ) B. advertising on children's programs is limited to 12 minutes per hour on weekdays and 10.5 minutes per hour on weekends. Advertisers don't like the publicity that accompanies a charge of false advertising. * 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. B. Wheeler Lea Several other companies received similar letters in 2010 from the FDA regarding front-panel "no trans fat" claims that failed to disclose significant levels of saturated fat and total fat. D. U.S. Department of Welfare ", courts have developed this to articulate just how much first amendment protection advertising receives and the criteria the government must satisfy to permissibly regulate it, false or misleading advertising, as well as advertising about unlawful foods or services, receives, truthful and non-misleading advertising about lawful goods and services receives an __________ _______ of first amendment protection. Finally, the commission has stated that when consumers can easily evaluate the product or service, when it is inexpensive, and when it is frequently purchased, the commission scrutinizes the advertisement or representation in a less critical manner. -actively insured _________________________: The act proscribes as "aggravated violations," warranting additional civil and commercial penalties, (a) e-mail "harvesting" or the knowing use of harvested addresses, (b) the automated creation of multiple e-mail accounts used for commercial e-mail, and (c) the use of unauthorized relays for commercial e-mail messages. D. National Association of Attorneys General Congress shall make no laws "abridging the freedom of speech, or of the press", Criteria for Judging whether Prior Restraint is Justified. A variety of federal agencies are empowered to enforce consumer protection laws. Free Speech Matrix A. Significant omission of important information. C. The Wheeler-Lea Amendment -subrogation. When advertisements or sales practices are targeted to a specific audience, such as those aimed at children or people who are elderly or terminally ill, they will be viewed from the perspective of a reasonable member of that group. 57a, empowers the Commission to promulgate trade regulation rules with the force and effect of law that "define with specificity" acts or practices that the Commission finds, based on substantial evidence in the rulemaking record, are prevalent and are unfair or deceptive. D. is concerned with the misrepresentation of premiums when used in sales promotions. There was time when competition between businesses hardly existed. D. Lanham Act Food and Drug Administration D. enticement Network standards regarding acceptable advertising have remained constant over the past 30 to 40 years. Self Regulation by the Advertising Industry, Local Regulation and Better Business Bureau. Injunctions: \end{array}\right]=\left[\begin{array}{rr} E. the impact of cease-and-desist orders, Controversy over the FTC's authority to regulate unfair advertising practices began in 1978, when the agency relied on this mandate to formulate its controversial _____ rule restricting advertising to children. Advertising Practices found to be unfair or deceptive 2. D. FDA Act By July 2012, the FTC had brought a dozen enforcement cases targeting illegal robocalls, with violators paying $5.6 million in total fines. D. STP Corporation. 4. B. Advertising *substantiation* has been an important part of the FTC regulatory scheme since 1972. Substantial Omission The key elements in the FTC's definition of deception are that the representation, omission, or practice must be likely to mislead the reasonable consumer and that it has: What message, either explicitly or implicitly, does the ad convey? The 10th Circuit ruled in 2004 that the Registry did not violate First Amendment rights because the government asserted a _______ and the Registry directly advanced that interest. C. ad substantiation agreement The law is not designed to protect the foolish or the "feeble minded," the commission has noted. The division of Consumer Protection Another word for advertisement is _____________________. A material misrepresentation or practice is one that is likely to affect a consumer's choice of a product. C. defined the requirements for advertising substantiation. -annuity's guaranteed interest rate States have what are called unfair and deceptive acts and practice statutes which give consumers the right to seek a judicial remedy in false advertising cases. The new law expanded the jurisdiction to practice "affecting commerce." The endorser must be a bona fide user of the product at the time the endorsement was given and while the endorsement is aired. 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 It defines an endorsement as any advertising message (including things such as verbal statements, demonstrations and depictions of the name of an individual or the name or seal of an organization) that consumers likely are to believe reflects the opinions, beliefs, findings or experiences of a party other than the sponsoring advertiser. C. if the ad uses puffery. 3. Rarely have these challenges been successful. The case goes to an appellate court, and there is no new finding of fact: What the FTC says is fact, is fact. A. materiality. The NARC became involved in the self-regulation of electronic retailing when it initiated the: -beneficiaries WebI. -set sales quota Corrective Advertising: -partially insured D. Fairness C. Wheeler-Lea Amendment E. Federal Communications Commission. E. noncompetitive advertising. * b. adopted the principle of caveat emptor. The _____ accepts cases dealing with product performance claims, superiority claims against competitive products, and all kinds of scientific and technical claims made in national advertising. *To illustrate this point, Scalia noted that a person may not opt out of paying income taxes just because he or she soesn't agree with how the govenrment is spending the money. 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. 1. B. Under the corrective advertising scheme, the FTC forces the advertiser to inform the public that in the past it has not been honest or has been misleading. Independent Business Alliance Federal Trade Commission. The FTC believes that the claim is deceptive. * B. consideration *The decision marked a victory for privacy advocates but can be seen as a blow to the free speech rights of telemarketers. D. any advertising on a broadcast media. 17. E. National Association of Broadcasters. _____________________________ (______): This agency describes itself as the children's arm of the advertising industry's self-regulation program, and it 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. WebAn agency relationship exists when one person, the _____ acts for, or on the behalf of another person, the _____. Nestl claims "Nestl makes the very best chocolate," Snapple advertises that its beverages are "made from the best stuff on Earth," are all examples of: The federal Lanham Act was adopted more than 60 years ago by Congress to stop unfair competition in the marketplace. (2) An advertisement shall not state or imply that the payment or amount of nonguaranteed elements is guaranteed. D. a commercial is approved at the storyboard stage but then is rejected after it is produced. Policies and procedures for self-regulation of advertising industry are established by the ____. E. advertising substantiation. The guides are of great benefit, however, to honest advertisers who seek to stay within the boundaries of what is allowable under the law. For example, an advertiser can argue that the deceptive statement is not material to the advertisement as a whole (that is, it will not influence the purchasing decision) or that the advertisement does not imply what the government thinks it implies. Sometimes the misleading statements are minor errors, but other timed they represent a major attempt at deception. What is Parramore's cash conversion cycle (CCC)? B. D. is more stringently self-regulated than any other medium. A. B. Centre for Electronic Technology. -FTC regulates spam Most states today have such laws. *Child Advertising Review Unit (CARU)*. E. Independent Business Alliance, D. Electronic Retailing Self-Regulation Program. D. Department of the Interior (DOI) 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 act also make sit illegal for a business to be a monopoly if that company is cheating or not competing fairly. Advertising . No more than 3 of the commissioners can be from the same political party. The advertising industry's most effective self-regulatory mechanism is the: f(x)=(x5)(12x). Yes, as long as the disclosure requirments are reasonably related to the government's interest in preventing deception of consumers. D. Puffery _______________________: Commercial e-mail messages that include "materially false or misleading" header information or deceptive subject lines are prohibited. 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. B. The FTC can seek an injunction to stop advertisements that it believed violated the law. Weba. -If you use a spokesperson, that spokesperson should support the product Significant omission of important information D. Electronic Retailing Self-Regulation Program (ERSP). -protection of proceeds against the beneficiary's creditors

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