Section 5 Unit 1 Exam

A  If Krening violates the cease-and-desist order, the firm may face penalties up to $43,792 for each day a deceptive ad runs.

B  The firm may face civil penalties ranging from the thousands to millions of dollars, depending on the infraction.

C  Krening’s broker may face jail time.

D  Krening may be required to run corrective advertising.

A  Ads making exaggerated claims most reasonable consumers wouldn’t believe

B  Any ad that is demonstrably false

C  Any ad that makes a health or safety claim or any claim that’s difficult for the consumer to evaluate

D  Ads for products that don’t offer any specific value to consumers

A  Fraud

B  Harassment

C  Misrepresentation

D  Panic selling

A  Any ad with a claim that’s clearly not true

B  Any ad that makes a health claim

C  Any ad likely to mislead consumers acting reasonably under the circumstances

D  Any ad or business practice that causes or is likely to cause injury

A  Junk Fax Prevention Act of 2005

B  Do Not Call Implementation Act of 2003

C  Anti-Telemarketer Act of 2000

D  CAN-SPAM Act of 2003

A  Only TV advertising

B  Only radio advertising

C  Only print advertising

D  Advertising by any means

A  Copy other peoples’ advertisements

B  Your broker friend’s website.

C  Brokerage policy manual

D  Google it

A  The Federal Trade Commission typically imposes jail time for truth in advertising violations.

B  The Federal Trade Commission determines the severity of the penalty based on the severity of the violation.

C  A cease-and-desist order from the Federal Trade Commission related to deceptive advertising becomes effective 30 days after issuance.

D  The severity of the civil penalty for violating truth in advertising laws is based on the number of consumers affected by the deceptive ad.