If a Business Files a Complaint with the National Advertising

question 55

Multiple Choice

If a business files a complaint with the National Advertising Division of the CBBB claiming that one of its competitors has unfairly and deceptively depicted the business in an ad,the NAD will:

• A) issue a cease and desist order if it finds the ad is indeed deceptive and misleading
• B) investigate the ad to determine if the FTC Act has been violated
• C) collect information and evaluate data concerning the complaint to determine if the advertiser's claims can be substantiated.
• D) refer the case to the FTC since it involves a business filing the complaint

Distinguish between different types of claims (e.g., self-contradictory, tautological) and understand their validity.

Recognize the significance of evidence and reasons in supporting claims.

Understand the importance of being unbiased and truthful for trustworthiness.

Apply critical thinking skills to evaluate the plausibility of claims.

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Definitions:

Periodic Inventory System

An inventory system where inventory levels are updated at specific intervals, typically through physical counts.

Net Method

A technique for accounting where discounts for early payment are assumed to be taken and recorded as such.

Returned Merchandise

Items that have been sold and subsequently returned by the customer to the seller due to defects, dissatisfaction, or other reasons.

Inventory Returns Estimated

An estimate of the value of goods that are anticipated to be returned by customers, used for accounting and inventory management purposes.