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Q:
(p.51)Much of the state legislation that deals with advertising is based on the:
A.constitution of Great Britain.
B.self-regulation codes published by the advertising profession.
C."truth-in-advertising" model developed by Printers Ink, the industry trade paper for many years.
D.U.S. Supreme courts "code of commercial speech."
E.federal governments "General Code of Advertising Ethics."
Q:
(p.52)Which of the following is the largest of the U.S. business-monitoring organizations?
A.Office of Consumer Affairs
B.Better business bureau
C.Consumer protection agency
D.American Association of Consumers
E.U.S. Chamber of commerce
Q:
(p.37)According to the owner of NPC & Associates, Marylands largest African-American-owned ad agency, "If you were to come from another planet and watch American television, you would think that all black people did was play basketball and hang out on street corners and do rap music." He is accusing advertising of:
A.making consumers too materialistic.
B.being excessive.
C.manipulating people into buying things they dont need.
D.being deliberately deceptive.
E.perpetuating stereotypes.
Q:
(p.37)Ever since the Napoleonic Wars, the British have used the derogatory term frogs' to refer to the French. When the London-based Institute Francais advertised French language courses at all levels from beginners to advanced students, it pictured the development of a frog in stages from egg through tadpole to full maturity. This would be an example of:
A.deliberate deception.
B.advertising manipulation.
C.faux marketing.
D.stereotype perpetuation.
E.cultural malfeasance.
Q:
(p.37)With respect to offensiveness in advertising, Benetton ads frequently come under attack for its usage of nudity and sexual innuendo. Professionals indicate that the ultimate regulator of such ads is the fact that:
A.the government is currently forming policy that will completely control this form of advertising.
B.companies such as this will never be able to successfully expand worldwide where moral standards are higher than in the United States.
C.trends will eventually change and the problem will take care of itself.
D.such companies will eventually run out of money and the advertising will cease.
E.if the ads dont pull in the audience, the campaign will falter and diethe marketplace has the ultimate veto power.
Q:
(p.39)_____ means doing what the advertiser and the advertisers peers believe is morally right in a given situation.
A.Principled advertising
B.Situational advertising
C.Truth-in-advertising
D.Ethical advertising
E.Responsible advertising
Q:
(p.39)Socially responsible advertisers:
A.are always is mindful of mans need for open communication.
B.do what the government wants.
C.do what society views as best for the welfare of people in general.
D.do what ethical societies have prescribed for businesses.
E.realize there primary responsibility is to provide the greatest good for the largest number of people.
Q:
(p.39)Nikes Air Jordan XX3, the 23rd edition of the series of shoes endorsed by retired basketball star Michael Jordan, differs from its predecessors because it is the first basketball shoe shaped by what Nike calls "Nike Considered," an approach to design that favors environmentally-preferable materials, reduces toxic chemicals and curbs waste. By adopting such environmentally-supportive standards to make its products, Nike is:
A.manipulating the consumer.
B.behaving in a socially responsible fashion.
C.perpetuating a materialistic viewpoint.
D.complying with federal regulations.
E.initiating a market development strategy.
Q:
(p.39)How do advertisers show their social responsibility?
A.By refraining from the use of advertising clutter
B.By providing millions of dollars of pro bono work to nonprofit organizations
C.By obeying FTC regulations
D.By creating markets for new products
E.By creating self-regulatory agencies
Q:
(p.41)How has the U.S. Supreme Court intervened in the rights of advertisers under the First Amendment?
A.It has supported the ban against professional advertising.
B.It has established strict control over packaged-goods advertising.
C.It has banned all cigarette advertisements from the broadcast media.
D.It has distinguished between "speech" and "commercial speech" and offered significant protection for truthful commercial speech.
E.It has made social responsibility mandatory for publicly traded firms.
Q:
(p.43)To promote responsible children's advertising and to respond to public concerns, the Council of Better Business Bureaus established the:
A.Children's Protection Agency (CPA).
B.Childrens Advertising Review Unit (CARU).
C.Childrens Board of Information.
D.Board of Advertising Review.
E.Code for Ethical Childrens Advertising (CECA).
Q:
(p.43-44)Which of the following statements about consumer privacy issues is true?
A.Concern about privacy is declining from a high reached during the 1990s.
B.The fact Web sites gather information about visitors without knowledge of the visitors is a privacy concern.
C.Internet companies use the information they gather about consumers to create personalized files about each individual.
D.The Federal Communications Commission regulates privacy rights.
E.Enabling cookies help the Internet users to safeguard their personal information.
Q:
(p.46)The Federal Trade Commission (FTC) regulates:
A.advertising for products sold in interstate commerce.
B.hazardous packaging and advertising of products.
C.liquor advertisements, through its power to suspend, revoke or deny renewal of manufacturing and sales permits for distillers and brewers.
D.the advertising, packaging and branding of all packaged goods.
E.the placement and wording of warning statements in advertisements for toys, household products and other hazardous substances that can cause injury or death.
Q:
(p.46)The FTC defines _____ as any ad that contains a misrepresentation, omission or other practice that can mislead a significant number of reasonable consumers to their detriment.
A.hazardous IMC
B.faux marketing
C.unfair advertising
D.deceptive advertising
E.subversive advertising
Q:
(p.46)U.S. Caviar ran ads in an onboard American Airlines magazine offering real Russian caviar at substantially lower prices than it typically sold for. Later FTC investigators determined that the caviar U.S. Caviar was selling as exotic Russian caviar was produced in the U.S. and was actually overpriced given its quality. U.S. Caviar engaged in:
A.an ethical lapse.
B.unethical advertising.
C.deceptive advertising.
D.an ethical dilemma.
E.anti-competitive advertising.
Q:
(p.46)Safeway, a UK supermarket chain, was reprimanded by a government agency in the United Kingdom because it distributed a leaflet titled "More reasons NOT to shop at Morrisons". (Morrisons is one of Safeways primary competitors in the UK). In the leaflet, Safeway depicted two shopping receipts, one for Safeway and one for Morrisons. The Safeway receipt claimed goods purchased at Safeway were much cheaper than the same goods purchased at Morrisons. Morrsions said that the goods on the imaginary receipt were not typical purchases and that the reason they were cheaper on the Safeway receipt was because the goods were on sale in the Safeway store. The FTC would have said that Safeway was guilty of:
A.an ethical lapse.
B.unethical advertising.
C.deceptive advertising.
D.an ethical dilemma.
E.non-competitive advertising.
Q:
(p.46)_____ advertising occurs when a consumer is "unjustifiably injured" or there is a "violation of public policy".
A.Deceptive
B.Corrective
C.Unfair
D.Hazardous
E.Injurious
Q:
(p.46)A complaint was filed with the Federal Trade Commission that accused the film industry regularly advertised R-rated movies during television shows and in magazines most popular with children. In other words, the FTC investigated to see if the film industry was guilty of:
A.hazardous advertising.
B.unfair advertising.
C.deceptive advertising.
D.an ethical dilemma.
E.anti-competitive advertising.
Q:
(p.32)Which of the following statements is true about how advertising affects competition?
A.Some observers believe that advertising actually restricts competition.
B.Advertising is not a barrier to competition.
C.Advertising is regulated so that it does not impede competition.
D.Intense advertising often encourages the entry of new brands and manufacturers into the marketplace.
E.Non-advertised products cannot compete with advertised products.
Q:
(p.32)Mike and Lou are going to the mall. Mike wants to buy a pair of jeans and Lou wants to buy a pair of Levi boot-cut jeans. Mike illustrates _____ demand while Lou illustrates _____ demand.
A.secondary; kinked
B.longitudinal; circular
C.external; internal
D.primary; selective
E.selective; primary
Q:
(p.32)Maria is very upset because the writers' strike has caused her to have to live without learning whats to come with the women on Desperate Housewives and how dangerous the secret organization depicted in Heroes is. Her husband is happy as long as something mindless is on television. Maria is exhibiting _____ demand.
A.primary
B.kinked
C.secondary
D.seasoned
E.selective
Q:
(p.32)What effect does advertising have on consumer demand?
A.Advertising creates trade barriers that prevent new competitors from entering the marketplace.
B.Advertising slows the rate of product decline.
C.Advertising moves the product quickly to the point in the product life cycle where it can be replaced by more efficient IMC.
D.Advertising slows the adoption process and thus, lengthens the product life cycle.
E.Advertising is intended to provide a smooth layoff to products in the latter stages of their PLC.
Q:
(p.33)Which of the following statements about the effects of advertising on the business cycle is true?
A.Historically, when business cycles dip, advertising expenditures increase.
B.The increased advertising expenditures that occur during business cycle dips always produce an increase in personal consumption expenditures.
C.When business cycles are down, advertising may act as a stabilizing force.
D.The effect of advertising on business cycles is easily determined and monitored.
E.Advertising does not affect the business cycle.
Q:
(p.33)The abundance principle states that in an economy that produces more goods and services than can be consumed, advertising:
A.maintains high prices.
B.keeps consumers informed of their selection alternatives.
C.contributes to the earths waste disposal problem.
D.prevents companies from successfully competing for consumer dollars.
E.acts as a stabilizing factor during a business cycle downturn.
Q:
(p.33)According to the ____, if an economy produces more goods and services than can be consumed, advertising allows companies to compete more effectively for consumer dollars and keeps consumers informed of their selection alternatives.
A.abundance principle
B.macroeconomic theory of supply and demand
C.economic principle of normalization
D.utilitarian principle of advertising
E.normative theory of supply and demand
Q:
(p.34)_____ refers to exaggerated, subjective claims that cant be proven true or false.
A.Misleading advertising
B.Hyperbole
C.Advertising manipulation
D.Exploitative advertising
E.Puffery
Q:
(p.34)When the city of Pensacola, Florida, advertises itself as "the perfect place for the perfect Florida vacation", it is using:
A.unfair advertising.
B.advertising hyperbole.
C.deceptive advertising.
D.puffery.
E.exploitative advertising.
Q:
(p.34)In a 1940 issue of Time magazine, the Chesapeake and Ohio train lines advertised that riding its trains would provide travelers with "the most pleasant trip they have ever known." This advertiser is using:
A.unfair advertising.
B.hyperbole.
C.deceptive advertising.
D.puffery.
E.exploitative advertising.
Q:
(p.34)Under current law, the only product claims that are considered deceptive are those that:
A.unjustifiably injures the consumer.
B.contain inadequate information.
C.violate public policy.
D.are factually false and have the potential of misleading reasonable people.
E.produce claims without prior substantiation.
Q:
(p.34)Which of the following statements is true about deceptive advertising?
A.Puffery can be called deceptive advertising when consumers believe it to be true.
B.Deceptive advertising is sometimes used because it establishes long-term consumer confidence in the product being advertised.
C.To be labeled as deceptive, ads must contain some claims which are not prior substantiated.
D.Deceptive ads serve the best interests of the advertisers.
E.There are no regulations governing deceptive advertising.
Q:
(p.36)The basic premise of _____ is that advertisers intentionally create ads with sexual messages that are hidden in the illustrations just below the limen.
A.suggestive selling
B.hidden attribution communication
C.subliminal advertising
D.periliminal communication
E.faux marketing
Q:
(p.36)According to Wilson Bryan Key, subliminal advertising:
A.works by creating a need for a previously unsought product.
B.consumers cannot be forced to perceive what cannot be seen.
C.works through embedded messages that seduce consumers into buying the good or service.
D.faux advertising is unethical.
E.results in a normative demand cycle for products.
Q:
(p.36)When advertisers spend millions of dollars trying to convince people that their products will make them sexier, healthier and more successful, they are trying to:
A.manipulate consumers' value systems.
B.shorten product life cycles.
C.avoid the need to use peripheral advertising.
D.proliferate stereotypical consumers.
E.avoid the use of puffery.
Q:
(p.36-37)Which of the following statements about the proliferation of advertising is true?
A.The proliferation of advertising is purely a consumer misperception.
B.While consumers believe there is a potential for too much advertising, advertisers do not believe it.
C.Most people tolerate ad clutter as the price they must pay for freedom of the press, free TV and a high standard of living.
D.The FCC has imposed no restraints on advertising clutter in any media.
E.The proliferation of advertising has plateaued.
Q:
(p.48)List and explain briefly the three courses of action open to the Federal Trade Commission (FTC) once it has determined an ad is deceptive or unfair.
Q:
(p.53)What are the two operating arms of the National Advertising Review Council (NARC)? Briefly explain the function of each.
Q:
(p.32)Distinguish between primary demand and selective demand?
Q:
(p.33)According to the abundance principle, what two important functions does advertising perform?
Q:
(p.37)Define the term stereotypes' in advertising.
Q:
(p.39)What is ethical advertising?
Q:
(p.48)What kinds of information does the Federal Trade Commission (FTC) look for in an investigation of a complaint about an advertiser?
Q:
(p.49)Discuss in brief the role of the Nutritional Labeling and Education Act (NLEA).
Q:
(p.50-51)What is a trademark? Give an example of a trademark.
Q:
(p.51)How does the Library of Congress help regulate advertising?
Q:
(p.51)What is the basis of most state legislation governing advertising?
Q:
(p.54)What is consumerism?
Q:
(p.29)According to the text, externalities are:
A.unseen opportunity costs.
B.social costs.
C.factors used to increase the reach of advertising.
D.environmental tangibility that act as barriers to communications.
E.inexpensive ways to increase perceptual value to a product.
Q:
(p.46)Distinguish between deceptive advertising and unfair advertising.
Q:
(p.30)According to the text, which of the following images best describes the chain reaction of economic events that takes place once a company begins to advertise?
A.The opening break shot in billiards
B.A beautiful woman entering a room
C.A car speeding up as it goes downhill
D.Throwing darts and hitting the bulls eye
E.The knocking over of a line of dominoes
Q:
(p.46)What are the roles and the responsibilities of the Federal Trade Commission (FTC)?
Q:
(p.30-31)How does advertising affect the value of a product?
A.Advertising cannot add value to a product if the advertising is needed to educate, consumers about a new product use.
B.By adding value to a product, advertising eliminates all perceptual barriers to purchase.
C.The value of advertising explains why someone would buy the more expensive Bayer aspirin rather than the store brand of aspirin that treats the same symptoms.
D.Advertising always gives added value to generic brands.
E.Advertising has no effect on the value of a brand or product.
Q:
(p.47)Define comparative advertising and describe how the FTC controls its misuse.
Q:
(p.32)Which of the following statements about how advertising affects price is true?
A.Advertising has a strong effect on the price of agricultural products such as leaf tobacco, soybeans and wheat
B.Advertising always increases the price of a productnever lowers it
C.The consumer who buys the product pays for the advertising
D.Advertising has had a significant impact on the prices charged by utilities
E.The amount typically spent on advertising is large compared with total sales
Q:
(p.45-46)Because there are so many federal, state and local agencies that regulate different aspects of advertising, advertisers sometimes find it difficult to comply with regulations.
Q:
(p.46)Deceptive advertising occurs when a consumer is "unjustifiably injured" or there is a "violation of public policy".
Q:
(p.47)When State Farm insurance uses advertising to show that it has lower rates than Progressive insurance, it is using comparative advertising.
Q:
(p.48)The FTC can request a company to use corrective advertising, but it may not legally require a company to do so.
Q:
(p.50-51)The big cursive G that appears in all ads for General Mills cereals is an example of a trademark.
Q:
(p.52)The chief function of the consumer protection agencies found in many cities and counties is to act as a watchdog for the federal regulators.
Q:
(p.52)The largest of the U.S. business-monitoring organizations is the Better Business Bureau.
Q:
(p.53)Uniform newspaper advertising codes make it easy for advertisers to make sure that their ads meet all legal and ethical requirements.
Q:
(p.32)Explain in brief the effect of advertisements on consumers and businesses.
Q:
(p.36)Critics claim advertising is so powerful that consumers are helpless to defend themselves against it.
Q:
(p.33)What does the abundance principle state?
Q:
(p.37)Critics argue there is too much advertising due to the proliferation of new media.
Q:
(p.39)Explain the difference between social responsibility and ethics in advertising.
Q:
(p.37)Advertisers today do not use male and female stereotypes in their ads.
Q:
(p.41)What are the four parts of the Central Hudson test?
Q:
(p.38)According to advertising supporters, it promotes a higher standard of living, subsidizes the arts and supports freedom of the press.
Q:
(p.45)List out the elements of Fair Information Practice Principles.
Q:
(p.39)Adherence to ethical and socially responsible principles is the moral obligation of advertisers.
Q:
(p.41)The U.S. Supreme Court does not differentiate between speech and commercial speech.
Q:
(p.43)While most children and parents are still joint consumers, more and more children are becoming sole decision makers.
Q:
(p.21)The availability of cable networks devoted to food, home repair, golf, history and animals is explained by the term:
A.tivo.
B.two-way media.
C.relationship marketing.
D.narrowcasting.
E.segmentation broadcasting.
Q:
(p.22)Due to PCs, Internet connections, DVDs and cable TV, advertising is evolving into a(n):
A.two-way medium.
B.reciprocal medium with limited prospects for the future.
C.analog medium.
D.narrowcasting medium.
E.reiterative advertising medium.
Q:
(p.23)By publicizing the material, social, and cultural opportunities of a free enterprise society, advertising has encouraged:
A.increased productivity by both management and labor.
B.interactive consumption.
C.relationship marketing.
D.a service economy.
E.public sector organizations.
Q:
(p.23)The term integrated marketing communications means:
A.integrating the concept of marketing and communication.
B.communicating the marketing information to the target audience.
C.integrating sales and communication of the company.
D.integrating the sales force of the company with proper marketing skills to achieve the desired results.
E.integrating all their marketing communications with what the companies actually do.
Q:
(p.30)The economic effect of advertising triggers off a chain reaction of hard to predict economic events.
Q:
(p.31)Advertising adds value to a brand by educating customers about new uses for a product.
Q:
(p.32)Intense competition cannot reduce the number of businesses in an industry.