Deck 4: Social, ethical, and Regulatory Aspects of Advertising and Promotion

Question 1

Critics of advertising claim that advertising addresses a wide variety of basic human needs.

Answer 1

False

Question 2

Consumer groups have been much less successful as the FTC in restricting children's advertising.

Answer 2

False

Question 3

Critics of advertising claim that advertising carries too much product information and that most advertising is unbiased,comprehensive,and inherently transparent.

Answer 3

False

Question 4

Societies tend to monitor advertising to determine what is irresponsible,unethical,or illegal.Despite social shifts and technological advances,a culture's views on what is acceptable and unacceptable change.

Question 5

As a promotional tool and an industry,advertising does not get a lot of attention,scrutiny,and criticism because it is so conspicuous and has established a global presence.

Question 6

Critics of advertising argue that advertising reduces a tendency to conformity and cuts down on status-seeking behavior.

Question 7

The calls for restrictions on advertising to children over the years have been based on very few concerns.

Question 8

There are reasons it would be hard to make laws against emotional appeals in ads,since even if they seem exaggerated or inaccurate,they are unquantifiable; thus,there is no way to prove this.

Question 9

The social aspects of advertisements are not important to consider.

Question 10

Vertical cooperative advertising is an advertising technique whereby a manufacturer and dealer share the expense of advertising.

Question 11

The FTC's regulations on deception have no authority over omissions or missing information about a product; they only cover false statements or misleading claims made by the advertiser.

Question 12

The primary area of advertising regulation is unsolicited or direct marketing.

Question 13

Proponents of advertising claim that advertisements do much more than just "shuffling of total demand," but contribute to the increase of total demand-showing that advertising is good for the economy.

Question 14

The FTC has regularly issued warnings to tobacco companies about ads that have been shown to cause young people to start smoking,backed up by decades of substantial evidence to this effect published by reputable medical journals.

Question 15

Subliminal advertisement relates with embedding images and messages into an advertisement that influence the unconscious minds of people; however,it is not proven to be effective.

Question 16

Advertisers of "controversial products" attempt to show social responsibility in advertising,such as beer companies spending millions a year addressing responsible drinking.

Question 17

An advertisement for a smartphone that compares itself to the smartphone of another firm is legal in the U.S.,even if the ad mentions brand-name goods produced by another firm.

Question 18

The massive consumption that advertising upholds and glorifies is actually quite good for American society,and for other cultures around the world.

Question 19

In advertising,deception refers to making transparent statements in advertisements.

Question 20

Advertising contributes to art and culture,and art and culture can be seen in advertising,too.

Question 21

The CAN SPAM Act outlaws all unsolicited emails.

Question 22

Examples of divisions within a local Better Business Bureau-merchandise,financial,and solicitations-investigateadvertising practices of companies in their geographic area.

Question 23

According to Maslow's hierarchy of needs theory,which of the following is the highest order of all human needs? 

A) Esteem needs 
B) Physiological needs 
C) Safety needs 
D) Self-actualization needs

Question 24

Which of the following is one of the four major aspects of advertising that lower the overall cost of products,according to proponents? 

A) Market segmentation 
B) Operating costs 
C) Inelasticity of demand 
D) Economies of scale

Question 25

Which of the following forms the lowest order of needs in Maslow's hierarchy of needs theory? 

A) Physiological needs 
B) Needs for affiliation 
C) Self-actualization needs 
D) Intrinsic needs

Question 26

According to Maslow's hierarchy of needs structure,ads for food or health care products can be thought of as promotions for products that address: 

A) physiological needs. 
B) love and belonging needs. 
C) self-actualizing needs. 
D) esteem needs.

Question 27

Many consumers buy products that they perceive to have recognition,prestige and status,which would be considered ________ needs under Maslow's hierarchy theory.

A) growth 
B) affiliation 
C) self-actualization 
D) esteem

Question 28

In a cease-and-desist order by the FTC,an advertiser agrees voluntarily to stop running the ad but doesn't have toadmit any guilt or wrongdoing.

Question 29

The field of public relations is not restricted by the same types of laws as other business elements of the promotional and marketing mix.

Question 30

A high-end specialty store,recognized nationwide for its prestigious reputation,is busy with customers eyeing and buying costly items of clothing with designer labels.They're also adding $400 purses,$500 shoes,and $1,000 bracelets and necklaces to their ensembles.Which of the following basic needs of Maslow's Hierarchy are most likely being fulfilled by these purchases? 

A) Extrinsic needs 
B) Need for affiliation  
C) Esteem needs 
D) Physiological needs

Question 31

Consumer and industry groups are free to make attempts at shaping and restricting the advertising process,but in reality have little voice or power.

Question 32

Supporters of industry self-regulation claim that self-regulation helps avoid unnecessary government meddling.

Question 33

The FTC's advertising substantiation program,set up in the 1970s,requires that documented evidence supporting any claims is not to be available to consumers.

Question 34

The main restriction of direct mail sweepstakes,as imposed by Congress,involves the requirement that they are randomly and fairly distributed to a wide range of communities and addresses throughout the 50 states.

Question 35

The first government restriction on telemarketing required companies to remove households from their dialing lists when residents requested this.

Question 36

When a professional athlete begins endorsing a line of energy bars and protein drinks,he is required to genuinely demonstrate using the product in the advertisement,although he does not have to utilize the product in day-to-day life. 

Question 37

State governments have a lot of authority over promotional activities of firms,and since most companies conduct interstate commerce,any violations are federal issues.

Question 38

Stephen Fox,a history and social observer,concludes that the history of American advertisement has been: 

A) genuine and trustworthy. 
B) simple and smart. 
C) irrelevant and incoherent. 
D) money-mad and hedonistic.

Question 39

The National Advertising Division (NAD)was empowered to create and enforce strict standards for packaging,labeling,distribution,and merchandising through its National Advertising Review Board (NARB).

Question 40

The cost of products is lowered: 

A) when there are high success rates of a product. 
B) by lowering the economies of scale of a product. 
C) when there is a high inelasticity of demand for a product. 
D) when there are little or no competitors with a similar product.

Question 41

Which of the following is true about ethics? 

A) It is largely based on personal judgment. 
B) It is applicable to business alone. 
C) It is strongly looked down upon in society. 
D) It is the basic structure of business.

Question 42

            is an advertising technique whereby a manufacturer and wholesaler share the expense of advertising.

A) Differentiation 
B) Subliminal advertising 
C) Market segmentation 
D) Vertical cooperative advertising

Question 43

Subliminal advertising refers to: 

A) influencing people to buy things via word of mouth advertisement. 
B) providing offers to the public that would stimulate them to buy their products. 
C) exaggerating the features of a product and providing assurances to stimulate people to buy a product. 
D) embedding hidden messages or images within an advertisement.

Question 44

           are moral standards and principles against which behavior is judged.

A) Ethics 
B) Appropriations 
C) Sects 
D) Dailies

Question 45

Three teenage girls who hang around together all start to smoke cigarettes,and eventually start to drink beer on weekends.With reference to recent research results of the Federal Trade Commission,the cause for the teenage girls' habits: 

A) have been most strongly influenced by families, friends, and peers. 
B) have been influenced by advertisements portraying it as cool. 
C) stem from hereditary traits. 
D) directly relate to advertising campaigns of criminally negligent firms.

Question 46

What was one of the government's earliest restrictions that targeted specific techniques and policies being used in programming and advertising designed for children? 

A) The Children's Food and Beverage Advertising Initiative 
B) The Nutrition Labeling and Education Act 
C) The "Cheeseburger Bill" 
D) The Children's Television Act

Question 47

Which of the following is true about advertising of alcohol and cigarettes? 

A) Brands in these categories don't spend a lot of money on advertisements to truly influence consumers. 
B) These ads are usually designed to be subliminal, suggesting but not causing behavior. 
C) Brands in these categories are only advertised as part of other programs which do not interest children. 
D) Advertising cannot create primary demand in mature product categories such as these.

Question 48

In their "Campaign for Real Beauty," the people creating the Dove ads attempted to be realistic,show sensitivity,and fight stereotypes by featuring: 

A) plus-size models who do not fit the narrow norm of beauty. 
B) women, who were not models, displaying various ethnicities, looks, and sizes. 
C) both men and women using Dove products. 
D) endorsements by famous elderly actresses with young-looking skin.

Question 49

_____ was established by the Better Business Bureau to evaluate ads directed at children based on guidelines that encourage sensitivity to their level of sophistication and knowledge,as well as emphasis on positive social traits such as friendship and kindness.

A) The Family Research Council 
B) The Children's Food and Beverage Advertising Initiative 
C) The Children's Advertising Review Unit 
D) The Children's Television Act

Question 50

Vertical cooperative advertising is usually legal,though there is a concern from competitors when: 

A) unquantifiable emotional appeals are involved. 
B) a representation, omission, or practice is misleading. 
C) firm uses monopoly power to dominate the other. 
D) bogus advertising allowances are given in the form of hidden price concessions.

Question 51

Although the courts and the FTC have been quite specific about defining many other practices,the definition of     has always been relatively vague.

A) unfairadvertising 
B) copyright infringement in advertising 
C) false labeling and packaging 
D) phishing in online advertising

Question 52

Sarah,a 13-year-old girl,came across an advertisement that displayed a new trendy hair color aimed at a mature audience.Intrigued by the advertisement,Sarah goes out and buys the product.This is an example of       .

A) primary demand stimulation 
B) subliminal advertising 
C) vertical cooperative advertising 
D) phishing

Question 53

Which of the following best describes primary demand? 

A) It is the demand for an entire range of various products. 
B) It is the demand for a specific brand. 
C) It is the demand for a specific product. 
D) It is the demand for an entire product category.

Question 54

Well-known illustrator Andy Warhol felt strongly that: 

A) visual manifestations of a sick society were being overtaken with consumerism and greed. 
B) art was for the people and the most accessible form of art is advertising. 
C) pioneering graphic innovations visually displayed the power of elitism. 
D) flashy images and tasteless visuals cluttered the cultural landscape.

Question 55

Which of the following claims demonstrates puffery in advertising? 

A) "Only Crest Earns the Dental Seal of Approval Among All Major Brands!" 
B) "Ford Trucks Have Lower MPG than Chevy Trucks!" 
C) "Tide Beats Cheer in Sales 8th Year in a Row!" 
D) "World's Best Cup of Coffee Served with a Smile Here!"

Question 56

If firms decide to use comparison advertisements,they: 

A) must convey a fair comparison in the ad. 
B) share the costs of advertising with local dealers and distributors. 
C) are acting in opposition to the recommendations of the American Association of Advertising Agencies. 
D) cannot legally mention a competing firm or brand by name.

Question 57

Which of the following best describes stealth sponsorship? 

A) It is when corporations pay journalists to give negative opinions about their competitors in their editorials. 
B) It is when corporations embed hidden messages in social media advertisements to unconsciously stimulate people to want something. 
C) It is when journalists are paid by corporations to receive favorable treatment in their editorials. 
D) It is when corporations partner with ancillary firms that they deal with to receive monetary favors from them.

Question 58

The Cheeseburger Bill passed by the U.S.House of Representatives: 

A) restricts advertisements featuring high calorie and high fat foods during children's programming. 
B) prevents falsifying nutrition information for fast foods. 
C) bars the promotion of toys to children that tie in with fast foods, sugary drinks, and salty snacks. 
D) blocks people from suing food companies for their obesity.

Question 59

Which aspects of advertising are legal but fall into an ethical gray area,making them almost impossible to legislate against? 

A) Disclaimers 
B) Emotional appeals 
C) Testimonials 
D) Contests and sweepstakes

Question 60

What is the most fundamental ethical issue in advertising? 

A) Exaggeration, which is a serious but increasingly common practice 
B) Taste, particularly regarding society's exposure to offensive messages 
C) Materialism, which also is a key legal issue 
D) Deception, particularly false or misleading statements

Question 61

The Telephone Consumer Fraud and Abuse Prevention Act of the mid-1990s: 

A) required telemarketers to maintain a list of customers who do not want to be called. 
B) banned recorded messages and robocalls. 
C) restricted telemarketers from calling customers more than twice a month. 
D) allowed the use of "robocalls" that contain recorded messages.

Question 62

A company received one of the most basic remedies used by the FTC.What is one of the FTC's most basic remedies in their regulatory programs? 

A) The FTC will dissolve the company for noncompliance. 
B) The FTC will issue a cease-and-desist order to the company. 
C) The FTC will sue the company so they cannot advertise for one month, if it is a first violation. 
D) The FTC will order that the company enroll in a corrective advertising program for one month.

Question 63

A food manufacturer is being investigated by the FTC for claims that its food can prevent liver disease.Its executives are aware that if the claims are found to be false,the firm may receive the FTC's most severe penalty,which involves: 

A) ordering corrective advertising. 
B) issuing a cease-and-desist order. 
C) an order to insert a disclaimer. 
D) dissolving the corporation.

Question 64

Which of the following is best describes the concept of "consumerism"? 

A) It is a relatively recent concept to explain the movement towards mobile marketing and location-based services. 
B) It involves consumer-oriented promotions such as coupons, premiums, and sweepstakes. 
C) It defines the actions that individuals and groups use to enact power in the marketplace. 
D) It refers to the ongoing expansion of contemporary marketing beyond traditional production of ads and commercials, including e-commerce and behavioral targeting.

Question 65

The Fair Packaging and Labeling Act regulating advertising focuses on: 

A) a way for consumers to compare the cost of household commodities and to prevent deceptive packaging. 
B) regulation of direct mail advertising and prohibiting lotteries. 
C) preventing obscenity, fraud, and the ability to deny or revoke licenses. 
D) direct mail.

Question 66

A social networking site could sell information regarding its users' online behavior to a soft drink manufacturing and advertising firm.This relates most to ___________.

A) nonprofit marketing 
B) appropriation 
C) phishing 
D) behavioral targeting

Question 67

            is the use of pictures or images owned by someone else without permission.

A) Defamation 
B) Spamming 
C) Phishing 
D) Appropriation

Question 68

Despite being registered under the Do Not Call Registry,a person can receive calls from: 

A) businesses they've contacted in the last six months. 
B) charities, political groups, market research firms, and companies you do business with. 
C) companies that have delivered something to the person in the last 24 months. 
D) co-operatives and insurance firms.

Question 69

The ____________ is dedicated to one dedicated idea-"unleashing the world-changing power of consumers." 

A) Consumer Finance Protection Agency 
B) Consumer Federation of America 
C) Consumers Union 
D) Consumer Review Unit

Question 70

Marketers have to be particularly cautious about using without legal protection,as fraud abounds.

A) coupons 
B) billboards 
C) premiums 
D) trade allowances

Question 71

Which nonprofit consumer organization was established in 1936 and is known for its publication of Consumer Reports? 

A) Consumer Federation of America 
B) Consumers Union 
C) Consumer Alert 
D) Commercial Alert

Question 72

________ is an insidious version of spam where Web users are enticed into entering personal information on a fake website that is forged to look like it is from a bank,the IRS,or other organizations.

A) Click-Fraud 
B) Appropriation 
C) Geofencing 
D) Phishing

Question 73

The __________ outlines the responsibilities and social impact of advertising and promotes high ethical standards of honesty and decency.

A) Advertising Substantiation Program 
B) American Association of Advertising Agencies' Creative Code 
C) Federal Communications Commission 
D) Code Authority of the NAB

Question 74

The ________ gives broad oversight over consumer products such as credit cards,money transfers,and payday loans.

A) Monetary Exchange Regulatory Board 
B) Federal Communications Commission 
C) Consumer Finance Protection Agency 
D) National Consumer Fiscal Agency

Question 75

The _________ of the FTC was initiated in 1971 with the intention of ensuring that advertisers make supporting evidence for claims available to consumers.

A) Wheeler-Lea Amendment 
B) advertising substantiation program 
C) Robinson-Patman Act 
D) Federal Communications Commission

Question 76

An area of advertising and IBP subject to privacy topics is when advertisers: 

A) make products more expensive. 
B) bring communities closer. 
C) vote in the Consumers Union. 
D) use geofencing to identify smartphone users within area and serve ads accordingly.

Question 77

            refers to unsolicited commercial messages,usually sent through e-mail.

A) Behavioral targeting 
B) Spam 
C) Premiums 
D) Infomercials

Question 78

What concept is involved when a statement that occurs in print is untrue and damages the reputation of a person,based on words found in magazine,newspaper,direct mail,or Internet reports? 

A) Libel 
B) Slander 
C) Larceny 
D) Appropriation

Question 79

Scenario 4-1
A group called Adbusters has a website containing many pages that address issues of consumption and culture, media practices, and corporate responsibilities. For example, "The momentum has clearly accelerated. By some measures humans have used more physical resources since World War II than in all of history before it. It's now taking a toll beyond anything we could ever have imagined. What does it mean when one sixth of the world's population consumes without any real restraint?" Throughout the website, there are many references to advertising's role in creating and maintaining this situation. Not surprisingly, virtually all of the references to the practice of advertising are negative. 
(Scenario 4-1)Organizations like Adbusters see advertising as superficial.This view of advertising says that it: 

A) is not entertaining, or even interesting, to consumers. 
B) has no effect on demand for specific brands of products. 
C) offers little information based on function or performance. 
D) ignores the hedonic aspects of products.

Question 80

The Wheeler-Lea Amendment in 1938 greatly influenced the future of advertising in America by: 

A) establishing the powerful Federal Trade Commission (FTC). 
B) allowing the FTC to stop practices that were misleading, regardless of their impact on competition. 
C) granting industries the right to form self-regulatory organizations to reduce FTC interference. 
D) broadening the FTC's power to practices that were unfair to competitors alone.