a. True
b.
False
1.
Quality
and safety of
products
are central to
consumers’ concerns.
a. True
b.
False
2. The
“subjective calculation“
for value is a
comparison
of quality received for the price
spent.
a. True
b.
False
3. By defrnition, quality does not include
service.
a. True
b.
False
4. Court cases and legal doctrine now make it clear that business is
responsible
for
product safety.
a. True
b.
False
5. The challenge that management faces is to make products as safe as possible and affordable to consumers.
a. True
b.
False
6. No matter how careful business is regarding the safety of its products, product liability suits are inevitable.
a. True
b.
False
7. U.S. residents, more than people in other countries, tend to sue when they are harmed.
a. True
b.
False
8. One concern about product liability is the size of the fmancial awards won in court.
9. Under the doctrine of strict liability, there is no legal defense for placing on the market a product that is dangerous to
a consumer because of a known or knowable defect unless an argument of due diligence is
allowed.
a. True
b.
False
10. The standard of absolute liability is less demanding than that of strict liability.
a. True
b.
False
11. Market share liability is rarely successful in current product liability lawsuits.
a. True
b.
False
12. The debate over
product liability
law continues.
a. True
b.
False
13. The Consumer Product Safety Commission is an independent laboratory that has power of persuasion only.
a. True
b.
False
14. The Consumer Product Safety Commission’s power and budgets have been subject to the administration in office.
a. True
b.
False
15. The Consumer Product Safety Commission is the only
clearinghouse
for consumers regarding unsafe products
a. True
b.
False
16. The Food and Drug
Administration
grew out of the work of one man.
a. True
b.
False
17. The Food and Drug Administration and the CPSC have been controversial over the decades.
a. True
b.
False
18.
Traditionally,
the Food and Drug
Administration’s
primary concern has been the “War on Drugs.”
a. True
b.
False
19. Business’s response to consumerism has consistently been to meet consumers’ demands as quickly and
effectively
as possible.
a. True
b.
False
20. A basic premise of Total Quality Management (TQM) is that the product designer is the
fmaljudge
of quality.
a. True
b.
False
21. The meaning of product quality is uniform to all.
a. True
b.
False
22. Which of the following is not a driver of the quest to improve product and service
quality?
a. the demands of a competitive
marketplace
b. cost controls
c. an increasingly sophisticated consumer
base
d. the threat of product liability lawsuits
23. The two central issues of goods and services
are
a. price and
warranties.
b.
reliability
and durability.
c. quality and
safety.
d. value and
function.
24. All of the following are reasons given for the current obsession with quality
except
a. the average consumer demands
more.
b. global competitiveness.
c. the
Internet.
d. employee
satisfaction.
25. Which of the following is not a dimension of quality listed in the textbook?
a.
performance
b. durability
c.
status
d.
aesthetics
26. All of the following are dimensions of quality
except
a.
features.
b.
conformance.
c. serviceability.
d. objectivity.
27. The ethical theory based on the concept of duty that states that fmns have a responsibility to comply with the
terms
of the sale, inform the customer about the product, not misrepresent anything, and not coerce the customer is
a. contractual
theory.
b. due care
theory.
c. social costs
view.
d. caveat
emptor.
28. The ethical theory based on the concept of duty that focuses on the relative vulnerability of the customer is
a. contractual theory.
b. due care theory.
c. social costs
view.
d. caveat
vendor.
29. The ethical theory based on the concept of duty that suggests that
if
a product causes harm, the firm should pay the
costs of any injury is
a. contractual theory.
b. due care theory.
c. social costs
view.
d. caveat
vendor.
30. The legal view of “let the buyer beware” that prevailed throughout most of history was
a. caveat
vendor.
b. e pluribus
unum.
c. norvus ordo
seclorum
d. caveat
emptor.
31. The current legal view of “let the seller take care” is
a. caveat
vendor.
b. e pluribis
unum.
c. norvus ordo sec
forum.
d. caveat
emptor.
32. Which of the following is not one of the top ten list of safety
principles?
a. Build safety into product design.
b. Educate consumers about product
safety.
c. Allow a margin of error for the
consumer.
d. Learn from your and others’
mistakes.
33. All of the following are in the top ten principles of safety
except
a. fully investigate product safety incidents.
b. encourage customers to try out the product before purchasing it.
c. report product safety defects
promptly.
d. track your product’s safety
performance.
34. Which of the following is not an allegation commonly made in product liability suits?
a. The product was improperly
manufactured.
b. The product’s design was
defective.
c. The manufacturer failed to provide satisfactory
instructions.
d. The product was produced under inhumane conditions.
35. The primary responsibility for product safety lies with
the
a. consumer.
b. goverrnnent.
c.
producer.
d. Consumer Product Safety
Commission.
36. Which of the following is not one of the top consumer product categories most frequently associated with injuries
requiring hospital treatment?
a. sports and recreational activities
b. horne maintenance and
construction
c. toys and children’s
products
d. automobiles
37. Reasons to be concerned about product liability include all of the following
except
a. the sheer number of
cases.
b. the number of trial attorneys being licensed.
c. the propensity of people to sue when they are
unhappy.
d. the growing size
offrnancial awards.
38. The legal principle that anyone in the value chain of a product is liable for harm caused to the user
if
the product as
sold was unreasonably dangerous is
a. strict liability.
b. absolute liability.
c. relative liability.
d. market share liability.
39. Due diligence means that a
company
a. has done sufficient preparatory work to produce a safe
product.
b. the company has successfully passed an OSHA safety
audit.
c. has taken every possible precautionary step possible and followed all industry
standards.
d. has studied the problem extensively.
40. The fact that a company is responsible for the harm done to customers by its product even
if
it can show that it
did
its best according to the state of the art in the industry at that time is
called
a. strict liability.
b. absolute liability.
c.
historical
liability.
d. market share liability.
41. A company that is held responsible for the damage caused by its product in proportion to its percentage of
industry
sales is subject to
a. strict liability.
b. absolute liability.
c. relative liability.
d. market share liability.
42. The Tylenol case in the 1980s, in which capsules were injected with cyanide, is an example
of
a. product extortion.
b. product liability.
c. product tampering.
d. product packaging.
43. Business claims that curreut product liability law suffers from all of the following problems
except
a. inefficieucy.
b. bias.
c. raising the costs
oflitigation.
d. imposition of a hiddeu tax on consumers.
44. Which of the following is not a way in which the Consumer Product Safety Commission works to reduce the risk
of
harm from consumer
products?
a. developing voluntary standards within an industry
b. issuing and enforcing mandatory standards
c. lobbying Congress to pass new consumer protection laws
d. conducting research on potential product
hazards
45. The Consumer Product Safety Commission works to reduce the risk of harm from consumer products in all of
the
following ways
except
a. banning consumer products.
b. passing legislation outlawing products.
c. obtaining recall of products.
d. informing and educating consumers.
46. Early research conducted in the organization later known as the Food and Drug Administration fed small doses
of
poison to
a.
rats.
b. chimpanzees.
c. the “Death
Squad.”
d. the “Poison Squad.”
47. The Food and Drug Administration regulates all of the following
except
a. food.
b.
drugs.
c.
cosmetics.
d. personal care
products.
48. Which of the following is not part of the FDA’s
mission?
a. to help identify and develop new foods and drugs
b. to promote the public health
c. to protect the public
health
d. to help reduce the burden of
regulation