Gloucester County Institute of Technology



Chapter 10 Consumer Power Chapter ResourcesBe an Informed ConsumerObjectivesAfter studying this section, you will be able to:?Identify and use reliable sources of consumer information.?Describe the process of evaluating consumer information.Checkpoint 10.1 Answers1.Name five sources of consumer information.Five sources of consumer information include other consumers, labels and hangtags, testing and rating services, salespersons, and the Internet2.What information are you likely to find on clothing labels?Clothing and textile products must be labeled with clear and complete care information, fiber content, the name of the distributor or manufacturer, and the country of origin.3.How can product rating information guide consumer purchases?Product ratings can help consumers evaluate features and compare different models and brands of similar products and services.4.What are some types of websites that may have product reviews?Reviews are available on company websites, independent rating websites, government websites, and consumer advocacy websites.5.What three questions can help you evaluate consumer information?Three questions that can help you evaluate consumer information include: Is the source reliable? What is the purpose of the information? How useful is the information?BuildYour Vocabulary Answerslabeling lawA labeling law is a government regulation that requires certain information be placed on labels for certain products.testing and rating serviceA testing and rating service is a group or organization that tests products and rates them according to certain criteria.reviewA review is a critical report or comments about an item. Section 10.2Protecting Your RightsObjectivesAfter studying this section, you will be able to:?Describe the rights and responsibilities of consumers.?Discuss the importance of consumer laws.?Identify reliable consumer advocates.?Recognize and guard against various forms of deceptive practices in the marketplace.?Outline steps for consumer self-defense.Checkpoint 10.2 Answers1.What eight consumer rights are listed in the Consumer Bill of Rights?The eight rights listed below are in the Consumer Bill of Rights: the right to safety; the right to be informed; the right to choose; the right to be heard; the right to satisfaction of basic needs; the right to redress; the right to consumer education; and the right to a healthful environment2.What are three examples of federal consumer laws?Three examples of federal consumer laws include: Consumer Product Safety Act; Federal Trade Commission Act; and Fair Credit Reporting Act3.List three deceptive practices consumers may encounter in the marketplace.Deceptive practices consumers may encounter in the marketplace include bait and switch, pyramid schemes, and sweepstakes.4.List three guidelines to follow when making a consumer complaint.Guidelines to follow when making a consumer complaint include: put your complaint in writing; be promp; do not wait weeks to act; and be specific and factual. (Students may provide other guidelines.)5.Name four methods consumers can use to resolve disputes.Methods consumers can use to resolve disputes include binding arbitration, small claims court, class action suits, and individual lawsuits.BuildYour Vocabulary Answersbait and switchBait and switch is a strategy that involves advertising one item and then substituting another item.pyramid schemeA pyramid scheme is a fraudulent investment plan.Ponzi schemeA Ponzi scheme is an investment operation in which money from new investors is used to pay earlier investors.chain letterChain letters are US letters or e-mails that promise a big return for a small investment. sweepstakesA sweepstakes is a promotional offer that gives participants the chance to win items of value or prizes.lotteryA lottery is an activity in which prizes are awarded to participants by chance in exchange for some form of payment.skill contestA skill contest is an opportunity to win prizes by demonstrating skill instead of chance.caveat emptorCaveat emptor is a term that means let the buyer beware.consumer advocateA consumer advocate is a group or an individual who promotes consumer rights.binding arbitrationBinding arbitration is a method of settling disagreements through an objective third party.small claims courtA small claims court is a part of the court system that offers a simple, prompt, and inexpensive way to settle minor differences involving small amounts of money.class action lawsuitA class action lawsuit is a legal court action brought by a group of individuals who have been similarly wronged.lawsuitA lawsuit is a civil action brought by a person (a plaintiff) against another party (the defendant). You Do the Math AnswersMolly wants to purchase several items of clothing. She is not sure she has enough money to buy the items she wants. Her budget is $95 before tax. The prices of each of three items are $16, $42, and $35. How can she figure the total cost of the three items without using a calculator?First, add 10 + 40 + 30 = 80.Then add 6 + 2 + 5 = 13.Finally, combine these two sums to find the answer: 80 + 13 = 93.ReviewYour Knowledge Answers1.What are two ways you can learn about products from other consumers?Frequently, you can learn about products and services by talking with friends, relatives, and neighbors. Many websites have a section where you can read reviews of products that have been posted by other customers.2.What information is typically included in labeling for food items?Food packages must carry a list of ingredients, the name and address of the manufacturer, the quantity by weight and number of servings, and specific nutritional information.3.What are two common forms of testing and rating results for products?Two common forms of testing and rating results are seals of approval or certification and ratings in consumer publications.4.How can you use the Internet to help you be a smart shopper?The Internet allows you to find the latest on consumer laws and protection; compare product prices, features, and availability; check the reliability of sellers; order merchandise; and file complaints.5.Why is it important to know whether product information is intended to inform the buyer or to sell a product or service?Both news articles and advertisements can offer useful information, but ads generally present only positive, sometimes exaggerated facts. Knowing this can help you make an informed decision.6.What government agency handles problems involving hazardous products?The Consumer Products Safety Commission handles problems involving hazardous products.7.What are some issues that may be addressed in an Airline Passenger Bill of Rights?Issues that may be addressed in an Airline Passenger Bill of Rights include: restrictions on the number and length of tarmac delays; prominent listing of all ticket costs and fees, eliminating the hidden costs of flying; compensation to passengers who are bumped;refunds of baggage fees for lost luggage; changes in reservations within 24 hours of booking without penalties.8.What is the main focus of the Fair Credit Reporting Act?The main focus of the Fair Credit Reporting Act is regulating the sharing of consumer data. 9.What are three federal government agencies that provide services and protection for consumers?Federal government agencies that provide services and protection for consumers include the Consumer Product Safety Commission, the Environmental Protection Agency, and the Food and Drug Administration. (Students may list other agencies.)10.What course of action can you take if you cannot get a serious consumer problem solved by contacting the seller or manufacturer?Actions you may be able to take include taking the problem to binding arbitration or a small claims court, or filing a class action or an individual lawsuit. ................
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