Chapter 20 – Regulation of Advertising and Promotion
71. (p. 705) The origin of the Federal Trade Commission’s corrective advertising program came
from a deceptive advertising case involving:
72. (p. 705) Which of the following programs is more likely to be the most controversial of all
the Federal Trade Commission’s programs?
Chapter 20 – Regulation of Advertising and Promotion
73. (p. 706) Under the FTC’s program of ____, Novartis Corporation was required to run
advertising informing consumers that it could not substantiate its claim that Doan’s pills were
superior to other over-the-counter analgesics in treating back pain. The FTC wanted to make
sure consumers were not under any false impression that Doan’s was a superior medication.
74. (p. 709) The _____ is a federal agency that was founded in 1934 to regulate broadcast
communication that include the radio, television, telephone and telegraph industries.
Chapter 20 – Regulation of Advertising and Promotion
75. (p. 709) Under the Children’s Television Act,:
76. (p. 709) Under the Reagan administration, the controversial _____ Doctrine, which required
broadcasters to provide time for opposing viewpoints on important issues, was repealed on the
grounds that it was counterproductive.
Chapter 20 – Regulation of Advertising and Promotion
77. (p. 709) Under the _____ Doctrine, the Federal Communications Commission (FCC)
required stations to run commercials about the harmful effects of smoking.
78. (p. 710) The _____ is the government agency that has authority over the labeling, packaging,
branding, ingredient listing and advertising of packaged foods and drug products.
Chapter 20 – Regulation of Advertising and Promotion
79. (p. 710–711) In 1996, President Clinton signed an executive order declaring that nicotine was
an addictive drug and gave the _____ broad jurisdiction to regulate the advertising of
cigarettes and smokeless tobacco.
80. (p. 712) The ____ has been heavily involved in the regulation of advertising of prescription
drugs.
Chapter 20 – Regulation of Advertising and Promotion
81. (p. 712) Direct-response advertisers that use the U.S. mail to deceive consumers by
marketing get-rich-quick schemes fall under the jurisdiction of the:
82. (p. 712) The _____ regulates and controls the advertising of alcoholic beverages.
Chapter 20 – Regulation of Advertising and Promotion
83. (p. 712) The _____ is a government regulation that is increasingly being used by companies
to sue competitors for false or misleading advertising claims.
84. (p. 712) The Bureau of Alcohol, Tobacco, and Firearms (BATF) is an agency within the
____.
Chapter 20 – Regulation of Advertising and Promotion
85. (p. 712) Which of the following agencies is responsible for tax collection for the liquor
industry?
86. (p. 713) Pizza Hut launched a civil suit against Papa John’s pizza claiming false and
misleading advertising made Pizza Hut’s pizza look inferior to Papa John’s. The federal law
that made this suit possible was the _____ Act.
Chapter 20 – Regulation of Advertising and Promotion
87. (p. 713) Acme Tire is developing an advertising campaign that will claim cars with its new
RX model stop 25 percent faster on wet pavement compared to other brands of tires. The
company must conduct careful studies to provide support for the claim because:
88. (p. 713) Texaco claimed its ClearSystem gasoline cleaned car engines, boosted mileage, and
reduced pollution emissions better than any other gas. Chevron contended its products were
just as good as Texaco’s. The _____ made it easier for Chevron to sue Texaco for this
perceived misrepresentation.
Chapter 20 – Regulation of Advertising and Promotion
89. (p. 713) The _____ closed a loophole in the Lanham Act and facilitated the ease with which
one company can sue a competitor for making false advertising claims about the first
company’s products.
90. (p. 716) Which of the following is used by many states as a basis for their advertising
regulations?
Chapter 20 – Regulation of Advertising and Promotion
91. (p. 716) The _____ moved against a number of national advertisers as a result of inactivity
by the Federal Trade Commission (FTC) during the Reagan administration.
92. (p. 717) Many areas of consumer and trade promotions are regulated by the _____ through
the Marketing Practices Division of the Bureau of Consumer Protection.
Chapter 20 – Regulation of Advertising and Promotion
93. (p. 717) Champion Sportswear has developed a “Super Bowl Sweepstakes” that it plans to
promote. To avoid having this promotion classified as a lottery, Champion should:
94. (p. 717) If a participant is required to give up something of value in order to participate in a
game or sweepstakes, then _____ is present, and the promotion is considered a lottery.
Chapter 20 – Regulation of Advertising and Promotion
95. (p. 717) A promotion such as a contest or sweepstakes can avoid being considered a lottery
or form of gambling by:
96. (p. 718) A study by the National Advertising Division’s Children’s Advertising Review Unit
found that the most prevalent violation of its voluntary advertising guidelines occurred with
_____ aimed at children.
Chapter 20 – Regulation of Advertising and Promotion
97. (p. 718) Marketers’ use of trade allowances is controlled by the ____, which prohibits price
discrimination.
98. (p. 719) Under the _____ passed in 1991, telemarketers must follow a complex set of rules
developed by the Federal Communications Commission.
Chapter 20 – Regulation of Advertising and Promotion
99. (p. 719) The Federal Trade Commission and U.S. Postal Service have laws that govern the
use of a(n) ____, whereby a company proposes to send merchandise to consumers and expects
payment unless a rejection or cancellation notice is sent by the consumer.
100. (p. 719) Unsolicited junk fax ads and telemarketing calls to consumers who do not want to
be called are banned under the: