Deck 12: Consumer Stakeholders: Product and Service Issues

Question 1

Canada's legal view of product liability differs somewhat from the U.S. notion of strict liability.

Answer 1

True

Question 2

Recent consumer surveys indicate that a sizable majority of consumers are relatively unconcerned about product quality.

Answer 2

False

Question 3

A vital assumption and premise of TQM is that product managers are the final judges of quality.

Answer 3

False

Question 4

Of the various issues associated with the product itself, quality issues seem to be the most pronounced in terms of ethics questions being raised.

Question 5

An example of product performance is whether or not a qualified repairer can repair your computer locally.

Question 6

Health Canada and its branches rarely work together with the U.S. Food and Drug Administration.

Question 7

Two major functions of a corporate product safety office are to act as a court of appeals on safety issues and to conduct safety education and training.

Question 8

Product liability has become a monumental consumer issue.

Question 9

Market-share liability has been applied in product-liability cases in which delayed physical reactions to allegedly hazardous products were not attributable to a specific lot or unit of an identified manufacturer's product.

Question 10

The doctrine of strict liability holds that only the manufacturer of the product is liable for harm caused to the user.

Question 11

Product tampering and extortion cases have been traditionally well publicized to assist in protecting the consuming public.

Question 12

The concept of absolute liability has been interpreted as holding manufacturers liable for damages in cases of injury when no warning of product hazard was issued, even though such hazards were not scientifically knowable at the time of manufacture.

Question 13

Today caveat emptor is qualified by the notion of caveat vendor.

Question 14

For a corporate consumer affairs office to be effective, one condition recommended is that it be located so that access to and by the CEO of the corporation is encouraged.

Question 15

It has been recommended that an effective consumer affairs office set up an information system to record and analyzes consumer satisfaction and complaints.

Question 16

All the identified critical dimensions of product quality and service can be objectively measured using physically visible criteria.

Question 17

Because some jurisdictions have limited product-liability damage awards, most major insurance companies are lowering their premiums.

Question 18

Health Canada administers the Food and Drug Act.

Question 19

Health Canada is a federal government department that acts in cooperation with provincial bodies to protect the health of Canadians.

Question 20

One aim of the Product Safety Programme is to protect the health of Canadians by assessing the management of health risks associated with consumer products.

Question 21

One of the reasons mentioned in the text for the growth of concern in product liability is that

A) Canada has become a society, which is more interest group oriented, rather than litigation oriented.
B) the number of cases of product-associated harm has greatly increased in recent years.
C) the size of the individual financial awards in product-liability lawsuits has been directly tied to the number of such lawsuits.
D) many otherwise noteworthy firms are declaring bankruptcy caused by skyrocketing liability insurance costs.

Question 22

Product tampering and extortion

A) have had significant implications for product packaging, as well as for product liability.
B) have been encouraged by an extreme interpretation of absolute liability.
C) evolved out of delayed manifestation cases and, thereby, have similar resolutions.
D) are unrelated to any of the above concepts.

Question 23

Consumer Product Safety (CPS) provides technical information regarding

A) Chemical hazards
B) Flammability hazards
C) Mechanical hazards
D) all of the above

Question 24

In the late 1980s and the 1990s, companies adopted these programs at an accelerating rate. This was a partial response to rapidly escalating global competitiveness.

A) Management By Objectives (MBO)
B) Total Quality Management (TQM)
C) Strategic Planning (SP)
D) Lower Cost Production (LCP)

Question 25

There are eight critical dimensions of product or service quality. Which one of them refers to the speed, courtesy, competence, and ease of repair?

A) performance
B) serviceability
C) aesthetics
D) reliability

Question 26

Which of the following ethical theories focuses on the contract between the firm and the customer?

A) contractual theory
B) due care theory
C) social costs view
D) consumer activist theory

Question 27

HECs principal programs include

A) Product safety.
B) Safe environments
C) Sustainable development
D) All of the above

Question 28

One result of the application of absolute liability in some product-liability cases is that

A) there is no incentive to start pharmaceutical businesses in places that apply this concept.
B) consumer groups have extended the application of this concept to nearly every aspect of consumerism.
C) some firms need to deal with major uncertainties in their production processes.
D) business associations that span several jurisdictions have taken up the major burden of litigating most product-liability lawsuits.

Question 29

All the following are among the critical dimensions of product or service quality, except

A) serviceability and features.
B) conformance and performance.
C) aesthetics and durability.
D) verifiability and convenience.

Question 30

Which doctrine holds that anyone in the value chain of a product is liable for harm caused to the user it the product as sold was unreasonably dangerous because of its defective condition?

A) doctrine of manufactured products
B) doctrine of product guaranty
C) doctrine of warranty
D) doctrine of strict-liability

Question 31

What does the notion of caveat vendor stand for?

A) "Let the seller take care"
B) "Let the consumer have all the information"
C) "Let the buyer beware"
D) "Let the company advertise"

Question 32

The CFIA aims to protect consumers by contributing to

A) Food safety
B) Protection of plants
C) Health of animals
D) All of the above

Question 33

Regarding products and services, the following two issues have been central over the past decade:

A) price and availability.
B) packaging and disposal.
C) quality and durability.
D) quality and safety.

Question 34

The famous Tylenol incident in the 1980's was a case of

A) Product tampering
B) False advertising
C) puffery
D) none of the above

Question 35

The doctrine that holds the manufacturer of a product liable for harm caused to the user if the product as sold was unreasonably dangerous because of its defective condition is called

A) caveat emptor.
B) hazardous substances protection.
C) punitive damages.
D) strict liability.

Question 36

The CFIA (Canadian Food Inspection Agency) was created in

A) 1985
B) 1945
C) 1967
D) 1997

Question 37

Among the reasons identified as potential direct causes of the problems in product liability are

A) most economic policies.
B) foreign competition.
C) our increasingly litigious society.
D) all of the above.

Question 38

Products most frequently associated with hospital treated injuries are

A) plants
B) carpets
C) Sports equipment
D) Office supplies

Question 39

Managers interested in consumer perception of product or service quality would be well advised to consider which of the following statements?

A) Product or service quality is all relative and, therefore, random.
B) Quality is a subtle and dynamic concept, requiring astuteness and sensitivity.
C) Production is somewhat more important than quality and, therefore, the former deserves more attention than the latter.
D) Quality is value-free and, therefore, is not usually an issue.

Question 40

What does the 1800's legal view caveat emptor stand for?

A) "Let the seller take care"
B) "Let the consumer have all the information"
C) "Let the buyer beware"
D) "Let the company advertise"

Question 41

All of the following, except one, were definitions of quality set forth by Carol Reeves and David Bednar. Which was not suggested?

A) excellence
B) conformance to specifications
C) meeting and/or exceeding expectations
D) efficient

Question 42

Which one of the following is not a functions of product safety office?

A) structuring and helping to enforce financial and nonfinancial rewards and penalties
B) helping with product safety litigation
C) setting up product safety committees
D) all of the above

Question 43

A company that wants to assess directly whether or not it is satisfying customer concerns is most likely to use

A) forecasting models and telemarketing.
B) customer satisfaction measurement.
C) government bureau statistics and charts.
D) industry averages and association data.

Question 44

Which on of the following is not a strength of quality definitions?

A) strong marketing and human resource benefits
B) concept of value incorporates multiple attributes
C) facilitates precise measurement
D) short-term and long-term evaluations may differ

Question 45

All the following have been identified as business responses to consumerism, except

A) a general call for more consumer-oriented government regulation.
B) establishment of consumer affairs offices.
C) setting up toll-free hotlines.
D) allowing consumer input into some marketing decisions.

Question 46

For a consumer affairs office to be effective, it is recommended that this office

A) monitor and evaluate how the corporation treats consumers.
B) be managed by a former consumer activist.
C) be staffed by outsiders and others sympathetic to consumer groups.
D) expect consumers to be responsible in their dealings with the corporation.

Question 47

The U.S. FDA engages in three broad categories of activities. Which one of the following is not one of the three?

A) analysis
B) surveillance
C) governing
D) correction

Question 48

Which one of the following is an essential function of an effective consumer affairs office?

A) establish a comprehensive, complete, and accurate database
B) audit the company's programs
C) recommended specific consumer programs, policies, and practices
D) all of the above

Question 49

It is typical for corporate consumer affairs officers to

A) act as consumer advocates.
B) make recommendations to management on the connection between corporate and consumer goals.
C) play either or both of the roles in (a) and (b).
D) initiate product-liability lawsuits.

Question 50

The reason product safety issues may need a significantly organized corporate component is that

A) the use of products by consumers is somewhat unpredictable.
B) top management may become isolated from potential consumer safety problems.
C) products are becoming increasingly complex, with associated complex safety implications.
D) all of the above.