CHAPTER THREE—Advertising and Society

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CHAPTER THREE
Advertising and Society
GENERAL CONTENT: MULTIPLE-CHOICE QUESTIONS
1.
________ is when an external message drives people to feel a need or want to buy
a product.
a.
Demand creation
b.
Manipulation
c.
Indirect advertising
d.
Want creation
e.
Need creation
(a; easy; p. 66; LO1; AACSB Ethical Reasoning)
2.
Advertising’s economic role has been criticized in the way it creates ________,
which means people want or feel a need to buy and use a product.
a.
desires
b.
demand
c.
motives
d.
markets
e.
profit
(b; moderate; p. 66; LO1; AACSB Ethical Reasoning)
3.
The question of whether advertising creates social values rather than merely
reflecting them is known as ________.
a.
the social-versus-economic debate
b.
the competitive-versus-market power debate
c.
the personal-versus-cumulative debate
d.
the personal-versus-social debate
e.
the shape-versus-mirror debate
(e; easy; p. 67; LO1; AACSB Ethical Reasoning)
4.
All EXCEPT which of the following are key ethical issues discussed in this
chapter?
a.
targeting strategies
b.
problems with advertising claims and other message strategies
c.
taste and offensive advertising
d.
unfair acts and practices
e.
stereotyping
(d; moderate; p. 69; LO1; AACSB Ethical Reasoning)
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5.
A ________ is a representation of a cultural group that emphasizes a trait or group
of traits that may or may not communicate an accurate representation of the
group.
a.
norm
b.
reference group
c.
caricature
d.
mean
e.
stereotype
(e; easy; p. 71; LO1; AACSB Ethical Reasoning)
6.
A term used to describe what happens when Western culture is imposed on others
is known as ________.
a.
marketing imposition
b.
cultural imposition
c.
marketing imperialism
d.
demand creation
e.
marketing elitism
(c; easy; p. 73; LO1; AACSB Ethical Reasoning)
7.
Marketing imperialism, or cultural imperialism, are terms used to describe
________.
a.
what happens when advertising is effective in creating demand
b.
how an external message drives people to feel a need or want for a product
c.
what happens when people in other cultures adopt Western culture
d.
how marketers attempt to be ethical
e.
what happens when Western culture is imposed on others
(e; easy; p. 73; LO1; AACSB Ethical Reasoning)
8.
Which of the following is true regarding customs?
a.
Customs are often subtle and, as a result, are easier to violate than laws.
b.
Customs are easily discerned.
c.
Customs are basically the same around the world.
d.
Customs have little impact on the effectiveness of advertising.
e.
Only natives of a culture can ever understand local customs.
(a; moderate; p. 73; LO1; AACSB Analytical Skills)
9.
Which is NOT an organization with oversight responsibility for advertising?
a.
government
b.
media
c.
competition
d.
public or community groups
e.
all of the above have oversight responsibility for advertising
(e; difficult; p. 79; LO2; AACSB Ethical Reasoning)
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Chapter Three: Advertising and Society
10.
Government oversight responsibility with respect to advertising includes
________.
a.
standards and reviews
b.
self-regulation
c.
laws and regulations
d.
complaints and punishment
e.
trademarks and copyrights
(c; moderate; p. 79; LO2; AACSB Communication)
11.
________ legislate(s) laws while ________ interpret(s) those laws in specific
situations.
a.
Courts; Congress
b.
Congress; courts
c.
The president; courts
d.
The president; Congress
e.
Congress; the FTC
(b; moderate; p. 79; LO2; AACSB Analytical Skills)
12.
Which arm of the federal government legislates laws regarding advertising?
a.
executive (the president)
b.
courts
c.
Federal Communications Commission
d.
Congress
e.
Federal Trade Commission
(d; moderate; p. 79; LO2; AACSB Communication)
13.
Which arm of the federal government interprets laws regarding advertising?
a.
executive (the president)
b.
courts
c.
Federal Communications Commission
d.
Congress
e.
Federal Trade Commission
(b; moderate; p. 79; LO2; AACSB Communication)
14.
A brand, corporate, or store name or a distinctive symbol that identifies the
seller’s brand and thus differentiates it from the brands of other sellers is known
as a ________.
a.
trademark
b.
copyright
c.
logo
d.
trade dress
e.
brand name
(a; easy; p. 79; LO2; AACSB Analytical Skills)
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15.
Which of the following is true regarding a trademark?
a.
It gives an organization the exclusive right to use or reproduce original
work such as an advertisement or package design for a period of time.
b.
Controls for protection are provided by the Library of Congress.
c.
The Department of Labor protects unique trademarks from infringement
by competitors.
d.
It identifies the seller’s brand and differentiates it from the brands of other
sellers.
e.
It must be registered with the Federal Trade Commission, which gives the
organization exclusive use of the mark, as long as the trademark is
maintained as an identification for a specific product.
(d; difficult; p. 79; LO2; AACSB Reflective Thinking)
16.
Under which amendment or act are unique trademarks protected from
infringement by competitors?
a.
Pure Food and Drug Act
b.
Wheeler-Lea Amendment
c.
Lanham Act
d.
Federal Trade Commission Act
e.
FTC Improvement Act
(c; difficult; p. 79; LO2; AACSB Analytical Skills)
17.
A ________ gives an organization the exclusive right to use or reproduce original
work such as an advertisement or package design for a period of time.
a.
trademark
b.
servicemark
c.
copyright
d.
constitutional amendment
e.
brand name
(c; easy; p. 80; LO2; AACSB Analytical Skills)
Which is FALSE regarding the Children’s Television Advertising Practice Act of
1990?
a.
It placed a 10.5-minute-per-hour ceiling for commercials in children’s
weekend television programming.
b.
All TV stations must air three hours of children’s educational shows a
week.
c.
Commercial breaks must be clearly distinguished from programming.
d.
It bars the use of program characters to promote products.
e.
It placed a 12-minute-per-hour limit for commercials in children’s
weekday television programming.
(b; difficult; p. 84; LO3; AACSB Ethical Reasoning)
18.
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Chapter Three: Advertising and Society
19.
________ is advertising or other sales representations that praise the item to be
sold with subjective opinions, superlatives, or exaggerations, vaguely and
generally, stating no specific facts.
a.
Puffery
b.
Manipulative advertising
c.
Deceptive advertising
d.
Comparative advertising
e.
Indirect advertising
(a; easy; p. 74; LO1; AACSB Ethical Reasoning)
20.
Under the ________ companies/plaintiffs are required to prove five elements to
win a false advertising lawsuit about an ad making a comparative claim.
a.
Uniform Commercial Code
b.
Pure Food and Drug Act
c.
Wheeler-Lea Amendment
d.
Lanham Act
e.
Magnuson-Moss Warranty Act
(d; moderate; p. 75; LO2; AACSB Analytical Skills)
Businesses can seek damages from an advertiser who “misrepresents the nature,
characteristics, qualities, or geographic origin in comparative advertising” under
the ________.
a.
Uniform Commercial Code
b.
Pure Food and Drug Act
c.
Wheeler-Lea Amendment
d.
Lanham Act
e.
Magnuson-Moss Warranty Act
(d; moderate; p. 75; LO2; AACSB Ethical Reasoning)
21.
22.
Under the Lanham Act, which of the following is NOT an element a
company/plaintiff is required to prove to win a false advertising lawsuit about an
ad containing a comparative claim?
a.
False statements have been made about either product.
b.
The ads actually deceived or had the tendency to deceive a substantial
segment of the audience.
c.
The offending advertiser intended to damage the complaining company’s
business.
d.
The deception was “material” and likely to influence purchasing decisions.
e.
Falsely advertised goods are sold in interstate commerce.
(c; difficult; pp. 75-76; LO2; AACSB Communication)
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23.
A(n) ________ is any advertising message that consumers believe reflects the
opinions, beliefs, or experiences of an individual, group, or institution.
a.
endorsement
b.
comparative ad
c.
puffed ad
d.
one-sided message
e.
two-sided message
(a; easy; p. 76; LO1; AACSB Analytical Skills)
24.
Verbal or written words in an advertisement that indicate exceptions to the
advertising claim made are known as ________.
a.
comparative ads
b.
puffery
c.
endorsements
d.
small print
e.
disclaimers
(e; moderate; p. 77; LO1; AACSB Communication)
25.
The main concern the FTC has when an advertiser substitutes for products during
a demonstration (i.e., using a mixture of glue and water instead of ice cream) is
________.
a.
whether the demonstration exaggerates the qualities of the product being
demonstrated
b.
whether the demonstration is realistic
c.
whether the advertiser indicates that substitutes are used in the
demonstration
d.
whether the consumer knows substitutes are used in the demonstration
e.
whether the demonstration falsely upgrades the consumers’ perception of
the advertised brand
(e; difficult; p. 77; LO1; AACSB Ethical Reasoning)
26.
The ethical responsibility for selling a controversial or unsafe product lies with
the ________.
a.
CEO of the organization
b.
marketing department
c.
advertising director
d.
Federal Trade Commission
e.
advertising agency
(b; moderate; p. 77; LO1; AACSB Ethical Reasoning)
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Chapter Three: Advertising and Society
27.
Before an advertising agency can create an ad for a client, it must consider which
of the following concerning the client company?
a.
the nature of the client company and its mission
b.
its available resources
c.
its reputation
d.
its product line
e.
all of the above
(e; moderate; p. 77; LO1; AACSB Communication)
28.
Cigarette advertising on television and radio has been banned since ________.
a.
1961
b.
1971
c.
1981
d.
1991
e.
2001
(b; moderate; p. 77; LO2)
Which is NOT an element of the FDA’s 1996 restrictions with regard to tobacco
advertising?
a.
a ban on all in-store advertising inside of stores that are located within
1,000 feet of a school or playground
b.
a ban on outdoor ads within 1,000 feet of a school or playground
c.
ads limited to black-and-white, text only, in magazines with 55 percent
readership under the age of 18
d.
$150 million be provided to fund antismoking ads targeting children
e.
half of the money from the Master settlement Agreement goes to fund TV
and print ads warning children about the dangers of smoking
(a; difficult; p. 78; LO1; AACSB Ethical Reasoning)
29.
30.
Why has the amount of prescription drug advertising skyrocketed in the past few
years?
a.
The FTC loosened its controls on pharmaceutical companies.
b.
The FCC loosened its controls on pharmaceutical companies.
c.
Demographic shift in U.S. population reflects an aging population, and
they tend to be heavy users of prescription drugs causing more
competition in the industry and thus more advertising.
d.
The FDA loosened its controls on pharmaceutical companies.
e.
Patents held by many pharmaceutical companies expired, resulting in price
competition and heavy advertising.
(d; moderate; p. 79; LO2; AACSB Communication)
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31.
Controls for copyright protection are provided by the ________.
a.
Supreme Court
b.
Federal Trade Commission
c.
Patent and Trademark Office
d.
Department of Commerce
e.
Library of Congress
(e; difficult; p. 80; LO3)
32.
The most basic federal law that governs advertising is the ________ Amendment
to the U.S. Constitution.
a.
First
b.
Second
c.
Third
d.
Fourth
e.
Fifth
(a; easy; p. 81; LO2; AACSB Communication)
33.
Which Amendment to the U.S. Constitution states that Congress shall make no
law “abridging the freedom of speech or of the press”?
a.
First
b.
Second
c.
Third
d.
Fourth
e.
Fifth
(a; easy; p. 81; LO2; AACSB Communication)
34.
________ speech is speech that promotes a commercial activity.
a.
Political
b.
Free
c.
Unregulated
d.
Commercial
e.
Regulated
(d; easy; p. 81; LO2; AACSB Communication)
35.
Which of the following statements is FALSE regarding commercial speech?
a.
It is speech that promotes commercial activity.
b.
It is often restricted.
c.
Its protection under the U.S. Constitution is absolute.
d.
It is legal to ban false or misleading commercial speech.
e.
It is legal to ban truthful commercial speech.
(c; moderate; p. 81; LO2; AACSB Communication)
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Chapter Three: Advertising and Society
36.
In which case did the Supreme Court establish a test that determines to what
extent the government can restrict advertising?
a.
Valentine v. Christensen (1942)
b.
Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council
(1976)
c.
Central Hudson Gas & Electric Corporation v. Public Service
Commission of New York (1980)
d.
Cincinnati v. Discovery Network (1993)
e.
44 Liquormart, Inc. v. Rhode Island (1995)
(c; difficult; p. 81; LO2; AACSB Communication)
37.
The Supreme Court’s ruling in Central Hudson Gas & Electric Corporation v.
Public Service Commission of New York is significant because ________.
a.
it is the first commercial speech case heard by the Supreme Court
b.
the Supreme Court decided that the First Amendment does not protect
purely commercial advertising because that type of advertising does not
contribute to decision-making in a democracy
c.
the Supreme Court ruled that states cannot prohibit businesses from
advertising prices
d.
the Supreme Court signaled strong protection for companies under the
First Amendment
e.
the Supreme Court established a test that determines to what extent the
government can restrict advertising
(e; difficult; p. 81; LO2; AACSB Analytical Skills)
38.
In which case did the Supreme Court signal strong protection for commercial
speech under the First Amendment?
a.
Valentine v. Christensen (1942)
b.
Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council
(1976)
c.
Central Hudson Gas & Electric Corporation v. Public Service
Commission of New York (1980)
d.
Cincinnati v. Discovery Network (1993)
e.
44 Liquormart, Inc. v. Rhode Island (1995)
(e; difficult; p. 81; LO2; AACSB Analytical Skills)
39.
What is the primary agency governing the advertising industry?
a.
Federal Communications Commission
b.
Federal Trade Commission
c.
Food and Drug Administration
d.
National Advertising Review Council
e.
National Advertising Division
(b; easy; p. 83; LO2)
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40.
Which is NOT a responsibility of the Federal Trade Commission?
a.
fine people or companies that violate either a trade regulation rule or a
cease-and-desist order given to any other firm in the industry
b.
fund participation of consumer groups and other interest groups in rulemaking proceedings
c.
oversee package labeling and ingredient listings for food and drugs
d.
regulate acts and practices that deceive businesses or consumers and issue
cease-and-desist orders where such practices exist
e.
initiate investigations against companies that engage in unfair competition
or deceptive practices
(c; moderate; p. 83; LO2)
41.
The ___________ .prohibits unfair and deceptive acts and practices regardless of
whether competition is injured.
a.
formation of the Federal Trade Commission
b.
Wheeler-Lea Amendment
c.
formation of the National Advertising Review Council
d.
Pure Food and Drug Act
e.
formation of the Bureau of Alcohol, Tobacco, and Firearms
(b; difficult; p. 84; LO2; AACSB Communication)
42.
Advertising intended to mislead consumers by making claims that are false or by
failure to make full disclosure of important facts, or both, is known as ________.
a.
misleading advertising
b.
indirect advertising
c.
deceptive advertising
d.
unsubstantiated advertising
e.
injurious advertising
(c; moderate; p. 85; LO2; AACSB Communication)
43.
Which is NOT a basic element of the current FTC policy on deception?
a.
preventable
b.
misleading
c.
reasonableness
d.
injurious
e.
all of the above are basic elements of the current FTC policy on deception
(a; moderate; p. 85; LO2)
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Chapter Three: Advertising and Society
44.
For an advertisement to be ruled deceptive, the deception must influence
consumers’ decision making about products and services, which is known as
________.
a.
misleading
b.
puffery
c.
material injury
d.
influence
e.
double jeopardy
(c; moderate; p. 85; LO2; AACSB Communication)
45.
What is NOT considered by the FTC when determining the reasonableness of a
claim in an advertisement?
a.
type and specificity of claim made
b.
type of product
c.
possible consequences of a false claim
d.
degree of reliance on the claims by consumers
e.
price of the product
(e; difficult; p. 85; LO2; AACSB Communication)
46.
A ________ is the first step in the regulation process after the FTC determines
that an ad is deceptive.
a.
consent decree
b.
cease-and-desist order
c.
corrective advertising campaign
d.
consumer redress order
e.
industry trade rule
(a; moderate; p. 85; LO2; AACSB Communication)
47.
All EXCEPT which of the following are FTC remedies for deception and unfair
advertising?
a.
consent decrees
b.
cease-and-desist orders
c.
incarceration
d.
corrective advertising
e.
consumer redress
(c; moderate; pp. 85-87; LO2; AACSB Communication)
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48.
Which of the following statements regarding cease-and-desist orders issued by the
Federal Trade Commission is false?
a.
They require that the deceptive or unfair practice by a business be stopped
within 30 days of issuance of the order.
b.
A cease-and-desist order given to one firm is applicable to all firms in an
industry.
c.
An advertiser can appeal the order to the full five-member commission.
d.
A cease-and-desist order is the first step in the regulation process after the
FTC determines that an ad is deceptive.
e.
The process leading to the issuance of a cease-and-desist order is similar
to a court trial.
(d; moderate; pp. 83 and 86; LO2; AACSB Analytical Skills)
49.
Which of the following is the landmark corrective advertising case?
a.
Valentine v. Christensen
b.
Warner-Lambert v. FTC
c.
44 Liquormart, Inc. v FTC
d.
Nike v. FTC
e.
Cincinnati v. Discovery Network
(b; moderate; p. 86; LO2; AACSB Communication)
50.
A relatively new remedy for deceptive and unfair advertising taken by the FTC is
to ________.
a.
make the deceptive advertiser spend time in prison
b.
fine a deceptive advertiser $10,000 per day for every day the deceptive ad
ran
c.
require corrective advertising to correct the false impressions a deceptive
ad made
d.
make the advertising agency liable for deceptive advertising along with
the advertiser when the agency is an active participant in the preparation
of the ad and knows or has reason to know that it is false or deceptive
e.
make public specific information about a deceptive advertising case
(d; difficult; pp. 86-87; LO2; AACSB Communication)
51.
Which federal agency oversees package labeling, ingredient listing, and
advertising for food and drugs?
a.
Federal Trade Commission
b.
Food and Drug Administration
c.
Federal Communications Commission
d.
Bureau of Alcohol, Tobacco, and Firearms
e.
National Advertising Division
(b; easy; p. 87; LO2)
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Chapter Three: Advertising and Society
52.
Which federal agency was formed to protect the public interest in radio and
television broadcast communications?
a.
Federal Trade Commission
b.
Food and Drug Administration
c.
Federal Communications Commission
d.
Bureau of Alcohol, Tobacco, and Firearms
e.
National Advertising Division
(c; easy; p. 87; LO2)
53.
The Federal Communications Commission (FCC) can take action against
________.
a.
the media
b.
advertisers
c.
advertising agencies
d.
A, B, and C
e.
B and C
(a; moderate; p. 87; LO2)
54.
All EXCEPT which of the following have governmental authority concerning
regulation of advertising in some way?
a.
Bureau of Alcohol, Tobacco, and Firearms
b.
Federal Communications Commission
c.
U.S. Postal Service
d.
National Advertising Division
e.
Food and Drug Administration
(d; moderate; pp. 83-88; LO2)
55.
________ advertising features a product other than the primary, and usually
controversial, product.
a.
Deceptive
b.
Unfair
c.
Stealth
d.
Injurious
e.
Indirect
(e; moderate; p. 83; LO2; AACSB Communication)
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What agreement was reached in 1996 between broadcasters, children’s advocates,
and the federal government?
a.
limiting advertising to 10 minutes per hour in children’s weekend
television programming
b.
limiting advertising to 12.5 minutes per hour in children’s weekday
television programming
c.
limiting advertising to 10 minutes per hour in all children’s television
programming
d.
requiring all TV stations to air three hours of children’s educational shows
a week
e.
banning all advertising during children’s television programming
(d; difficult; p. 85; LO2)
56.
57.
Which type of self-regulation occurs when an organization, such as an advertising
agency, develops, uses, and enforces norms within its own practices?
a.
industry self-regulation
b.
self-discipline
c.
social ethic
d.
self-regulation with outside help
e.
personal ethic
(b; moderate; p. 89; LO2; AACSB Ethical Reasoning)
58.
When an industry develops, uses, and enforces norms, this is known as which
type of self-regulation?
a.
industry self-regulation
b.
self-discipline
c.
social ethic
d.
professional ethic
e.
personal ethic
(a; moderate; p. 89; LO2; AACSB Ethical Reasoning)
59.
In 1971, what organization did several professional advertising associations in
conjunction with the Council of Better Business Bureaus establish to negotiate
voluntary withdrawal of national advertising that professionals consider
deceptive?
a.
National Advertising Division (NAD)
b.
National Advertising Review Board (NARB)
c.
American Association of Advertising Agencies (4As)
d.
National Advertising Review Council (NARC)
e.
American Advertising Federation (AAF)
(d; moderate; pp. 89-90; LO2)
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Chapter Three: Advertising and Society
60.
The two operating arms of the National Advertising Review Council are the
________.
a.
NAD and the NARB
b.
NAD and the AAAA
c.
AAF and the AAAA
d.
FTC and the FCC
e.
FTC and the NAD
(a; moderate; pp. 89-90; LO2)
61.
Which arm of the National Advertising Review Council is a full-time agency
made up of people from the field of advertising; evaluates complaints submitted
by consumers, consumer groups, industrial organizations, and advertising firms;
and does its own industry monitoring of national advertisements?
a.
National Advertising Division (NAD)
b.
National Advertising Review Board (NARB)
c.
American Association of Advertising Agencies (4As)
d.
Federal Trade Commission (FTC)
e.
American Advertising Federation (AAF)
(a; moderate; p. 90; LO2)
62.
If the National Advertising Division (NAD) and the allegedly deceptive advertiser
cannot reach a satisfactory resolution, the case is referred to the ________.
a.
National Advertising Review Board (NARB)
b.
American Association of Advertising Agencies (4As)
c.
Federal Trade Commission (FTC)
d.
American Advertising Federation (AAF)
e.
appropriate government agency
(a; moderate; p. 90; LO2)
63.
If the National Advertising Review Board (NARB) and the allegedly deceptive
advertiser cannot reach a satisfactory resolution, the case might be referred to the
________.
a.
National Advertising Division (NAD)
b.
American Association of Advertising Agencies (4As)
c.
Advertising Review Council (ARC)
d.
American Advertising Federation (AAF)
e.
appropriate government agency, such as the FTC
(e; moderate; p. 90; LO2)
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64.
________ is a set of moral principles that guide actions and create a sense of
responsible behavior.
a.
Social responsibility
b.
Ethics
c.
Self-regulation
d.
Taste
e.
Self-discipline
(b; easy; p. 91; LO3; AACSB Ethical Reasoning)
65.
With respect to guidelines for determining what is ethical, which is NOT one of
the types of criteria for making an advertising decision?
a.
moral systems
b.
self-discipline
c.
professional ethic
d.
personal ethic
e.
internal moral compass
(b; moderate; pp. 91-94; LO3; AACSB Ethical Reasoning)
66.
The ________. is an examples of a moral system.
a.
The Ten Commandments
b.
The Social Ethic
c.
The Personal Rule
d.
The Golden Ethic
e.
The Responsible Rule
(a; moderate; p. 91; LO2; AACSB Ethical Reasoning)
67.
________ motivates a business to perform a useful function within society and to
make its impact on society positive rather than negative.
a.
Moral compass
b.
Social ethics
c.
Social responsibility
d.
Professional standards
e.
Personal ethics
(c; moderate; pp. 77 and 94; LO3; AACSB Ethical Reasoning)
68.
Which is NOT included in the concept of social responsibility?
a.
treating employees and other stakeholders with sensitivity
b.
avoiding practices that hurt the environment
c.
avoiding practices that hurt the community
d.
avoiding practices that hurt society
e.
treating foreigners in our country as though they are Americans
(e; moderate; pp. 66, 77, 92 LO1; AACSB Ethical Reasoning)
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Chapter Three: Advertising and Society
69.
A ________ identifies how professionals in the industry should respond when
faced with ethical questions.
a.
code of behavior
b.
code of standards
c.
code of laws
d.
code of responsibility
e.
code of discipline
(b; moderate; p. 93; LO3; AACSB Ethical Reasoning
70.
Personal judgment and moral reasoning rest on ________.
a.
explicit laws governing practice
b.
membership in a professional association
c.
an understanding of the law
d.
a sense of right and wrong
e.
a code of standards
(d; moderate; p. 91; LO2)
GENERAL CONTENT: TRUE/FALSE QUESTIONS
71.
Critics of advertising tend to believe that advertising has power to shape social
trends and the way people think and act.
(True; easy; pp. 67-68; LO1; AACSB Ethical Reasoning)
72.
Advertising professionals tend to believe that advertising has the power to shape
social trends and the way people think and act.
(False; moderate; p. 68; LO1; AACSB Ethical Reasoning)
73.
Marketing imperialism is a term used to describe what happens when Western
culture is imposed on others.
(True; easy; p. 73; LO1)
74.
Customs can be even stronger than laws.
(True; moderate; p. 73; LO1; AACSB Analytical Skills)
75.
Stereotypes can be useful and aid communication by using easily understood
symbolic meanings.
(True; moderate; p. 71; LO1; AACSB Ethical Reasoning)
76.
A misleading claim is a legal problem only in the United States.
(False; easy; p. 74; LO2)
77.
“Puffing” claims are illegal.
(False; moderate; p. 74; LO2)
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78.
A spokesperson who endorses a brand must actually use the product for this to be
a legal message strategy.
(True; moderate; p. 76; LO2; AACSB Communication)
79.
A copyright is a brand, corporate, or store name or a distinctive symbol that
identifies the seller’s brand and thus differentiates it from the brands of others
sellers.
(False; moderate; p. 80; LO2)
80.
A trademark must be registered with the Library of Congress.
(False; easy; p. 79; LO2)
81.
A copyright gives an organization the exclusive right to use or reproduce original
work such as an advertisement or package design indefinitely.
(False; difficult; p. 80; LO2; AACSB Communication)
82.
Common designs or symbols can be copyrighted.
(False; moderate; p. 80; LO2)
83.
Under the First Amendment to the U.S. Constitution, protection of commercial
speech is absolute.
(False; moderate; p. 81; LO2)
84.
The government can ban truthful commercial speech.
(True; difficult; p. 81; LO2)
85.
The Federal Trade Commission (FTC) is the primary agency governing the
advertising industry.
(True; easy; p. 83; LO2)
86.
A cease-and-desist order given to any firm in an industry applies to all firms in
that industry.
(True; difficult; p. 83; LO2)
87.
To be considered deceptive, a false or misleading advertisement must influence
consumers’ decision making about the product or service advertised.
(True; moderate; p. 85; LO2; AACSB Communication)
88.
The current FTC policy on deception is clear and easy for advertisers to measure.
(False; moderate; p. 85; LO2)
89.
An advertiser must have data on file to substantiate any claims it makes in its
advertisements.
(True; difficult; p. 85; LO2; AACSB Communication)
90
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Chapter Three: Advertising and Society
90.
The FTC accepts only research conducted by an independent research firm when
questioning an advertiser’s claim substantiation.
(False; difficult; p. 85; LO2; AACSB Communication)
91.
Advertisers must comply with a consent decree.
(False; moderate; pp. 85-86; LO2)
92.
The first step in the regulation process after the FTC determines that an ad is
deceptive is the issuance of a cease-and-desist order.
(False; moderate; p. 85; LO2)
93.
The process leading to the issuance of a cease-and-desist order is similar to a
court trial.
(True; moderate; p. 86; LO2; AACSB Ethical Reasoning)
94.
An advertising agency can be held liable along with the advertiser for deceptive
advertising.
(True; moderate; p. 86-87; LO2; AACSB Communication)
95.
With respect to prescription drugs, the Food and Drug Administration’s primary
job is to determine whether the drugs are marketed in a responsible way.
(False; moderate; p. 87; LO2)
96.
The Federal Communications Commission (FCC) has the power to ban messages,
including ads appearing in any medium, that are deceptive or in poor taste.
(False; moderate; p. 87; LO2)
97.
The Federal Communications Commission (FCC) has the authority to take legal
actions against advertisers and advertising agencies.
(False; difficult; p. 87; LO2)
98.
Indirect advertising that features a product other than the primary, and usually
controversial, product is illegal in most countries.
(False; moderate; p. 83; LO2)
99.
International advertisers do not fear actual laws; they fear not knowing those
laws.
(True; moderate; p. 83; LO2)
100. The media can reject ads that violate their standards of truth and good taste.
(True; easy; p. 88; LO2; AACSB Ethical Reasoning)
101.
Virtually all major advertisers and advertising agencies have in-house ad review
procedures including reviews by agency and client attorneys.
(True; moderate; p. 89; LO2; AACSB Ethical Reasoning)
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102.
The National Advertising Division (NAD) and the National Advertising Review
Board (NARB) are government agencies that negotiate the voluntary withdrawal
of national advertising that professionals consider deceptive.
(False; moderate; pp. 89-90; LO2)
103.
The Better Business Bureau is a government agency with the power to oversee
advertising, particularly local advertising.
(False; moderate; p. 90; LO2; AACSB Ethical Reasoning)
104. Advertising that is in poor taste and offensive is easily identified.
(False; moderate; p. 87; LO2)
105.
A code of standards identifies how a professional in the industry must respond
when faced with ethical questions.
(False; difficult; p. 93; LO2; AACSB Ethical Reasoning)
GENERAL CONTENT: ESSAY QUESTIONS
106.
Compare and contrast a trademark and a copyright. Explain the importance of
each and how each is protected.
Answer:
A trademark is a brand, corporate, or store name or a distinctive symbol that
identifies the seller’s brand and thus differentiates it from the brands of other
sellers. A trademark that is registered through the Patent and Trademark Office of
the Department of Commerce gives the organization exclusive use of the mark, as
long as the trademark is maintained as an identification for a specific product.
Because trademarks are critical communication devices for products and services,
they are important to advertising.
A copyright gives an organization the exclusive right to use or reproduce original
work such as an advertisement or package design for a period of time. Controls
for copyright protection are provided by the Library of Congress. Advertising is a
competitive business in which me-too ads abound, and copyrighting of coined
words, phrases, illustrations, characters, and photographs can offer some
protection from other advertisers who borrow too heavily from their competitors.
(moderate; pp. 79-80; LO2; AACSB Reflective Thinking)
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Chapter Three: Advertising and Society
107.
Describe the four specific responsibilities of the Federal Trade Commission.
Answer:
The four specific FTC responsibilities are the following:
(1) Initiate investigations against companies that engage in unfair competition or
deceptive practices.
(2) Regulate acts and practices that deceive businesses or consumers and issue
cease-and-desist orders where such practices exist.
(3) Issue fines to violators of either a trade regulation rule or a cease-and-desist
order given to any other firm in the industry.
(4) Fund the participation of consumer groups and other interest groups in rulemaking proceedings.
(moderate; p. 83; LO2)
108.
Define deceptive advertising and explain the three basic elements of the current
FTC policy on deception.
Answer:
Deceptive advertising is advertising intended to mislead consumers by making
claims that are false or by failure to make full disclosure of important facts, or
both. The current FTC policy on deception contains three basic elements:
(1)
Misleading—Where there is a representation, omission, or practice, there
must be a high probability that it will mislead the consumer.
(2)
Reasonableness—The perspective of the “reasonable consumer” is used to
judge deception. The FTC tests reasonableness by looking at whether the
consumer’s interpretation or reaction to an advertisement is reasonable.
(3)
Injurious—The deception must lead to material injury. That is, it must
influence consumers’ decision making about products and services.
(moderate; p. 85; LO2; AACSB Communication)
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109.
Name and describe the five FTC remedies for deception and unfair advertising.
Answer:
The FTC can follow several courses of actions:
(1)
Consent Decrees—The first step in the regulation process after the FTC
determines that an ad is deceptive. The FTC notifies the advertiser of its
finding and asks the advertiser to sign a consent decree agreeing to stop
the deceptive practice. Most advertisers do sign the decree to avoid bad
publicity and the possible $10,000-per-day fine for refusing to do so.
(2)
Cease-and-Desist Orders—Issued when the advertiser refuses to sign the
consent decree and the deception is determined to be substantial. The
process leading to the issuance of a cease-and-desist order is similar to a
court trial, in which an administrative law judge presides and lawyers
represent both parties.
(3)
Corrective Advertising—May be required when consumer research
determines that an advertising campaign has perpetuated lasting false
beliefs. The FTC orders the offending advertiser to produce messages for
consumers that correct the false impressions the ad made.
(4)
Consumer Redress—The FTC can order cancellation or reformation of
contracts, refund of money or return of property, payment of damages,
and/or public notification.
(5)
Advertising Agency Legal Responsibility—The FTC can hold the ad
agency liable instead of, or along with, the advertiser.
(moderate; pp. 85-87; LO2; AACSB Communication)
110.
Discuss three types of ethical criteria that need to be considered when making an
advertising decision.
Answer:
Three types of criteria need to be considered when making an advertising
decision:
(1)
The Social Responsiblity— Social responsibility motivates a business to
perform a useful function within society and to make its impact on society
positive rather than negative—and that includes its advertising, as well as
other business practices.
(2)
The Professional Ethics—Professional ethics are often expressed in a code
of standards that identifies how professionals in the industry should
respond when faced with ethical standards.
(3)
The Personal Ethic—Personal judgment and moral reasoning rest on an
intuitive sense of right and wrong.
(difficult; pp. 66, 91, and 93; LO3; AACSB Ethical Reasoning)
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Chapter Three: Advertising and Society
ADDITIONAL CONTENT: MULTIPLE-CHOICE QUESTIONS
111.
Ads that play on women's insecurities by portraying perfect looking women who
are unnaturally thin are examples of ________.
a.
deceptive advertisements
b.
violating another company’s trademark
c.
body image
d.
inexpensive ads to produce
e.
effective advertisements
(c; easy; p. 72; LO1; AACSB Ethical Reasoning)
112.
Many people objected to an ad that used a style of lighting and staging
reminiscent of a porn movie to show prepubescent teens in their underwear
because it was ________.
a.
in poor taste and offensive
b.
too materialistic
c.
racial stereotyping
d.
too dark
e.
humorous
(a; moderate; p. 69; LO1; AACSB Ethical Reasoning)
113.
A spot for Just for Feet that showed a barefoot black man running through the
wilderness tracked by a patrol in a Humvee was considered objectionable
________.
a.
because it was offensive and in bad taste
b.
because it made viewers feel inferior about their body and self-image
c.
because it was a misleading advertisement
d.
because it was targeting African Americans
e.
because it was racial stereotyping
(e; difficult; pp. 69-70; LO1; AACSB Analytical Skills)
114.
Some claim advertising has created a society that is obsessed with personal
hygiene because consumers are bombarded with ads for products that remove our
body odors, make our teeth white, make our hair shine, allow us to fit in with our
peers, and make our family love us more. On what side of the social debate on
advertising do believers of this statement reside?
a.
advertising mirrors social values
b.
advertising mimics social values
c.
advertising shapes social values
d.
advertising manipulates social values
e.
advertising is offensive
(c; moderate; pp. 67-68; LO1; AACSB Reflective Thinking)
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115.
Some Asian and Middle Eastern countries are critical of what they see as
America’s materialism and disrespectful behavior toward women and elders and
are worried that advertising will encourage their young people to adopt these
viewpoints. The term to describe this phenomenon is ________.
a.
marketing ethics
b.
deceptive advertising
c.
social decline
d.
social responsibility
e.
marketing imperialism
(e; moderate; p. 73; LO1; AACSB Ethical Reasoning)
Nike’s longtime symbol on its products and in its ads is the Nike “Swoosh,”
which looks like a curved checkmark. If another athletic shoemaker used that
symbol on its products or in its ads, the company would most likely be guilty of
________.
a.
comparative advertising
b.
competitive infringement
c.
misleading advertising
d.
trademark infringement
e.
deceptive advertising
(d; easy; p. 79; LO2; AACSB Reflective Thinking)
116.
117.
When Kraft foods made a claim that their processed cheese slices contained as
much calcium as that contained in 5 ounces of milk, the Federal Trade
Commission pursued it as a deceptive claim. Although Kraft admitted that a
cheese slice did not actually contain as much calcium as claimed due to
processing, the company claimed that its ad was not deceptive because consumer
research indicated that calcium content was not important to consumers when
deciding among brands of cheese. Basically, Kraft’s defense was based on its
belief that the misleading claim ________.
a.
did not lead to material injury to consumers, and thus it was not deceptive
b.
did not claim anything different from other cheese manufacturers
c.
was not technically misleading if consumers didn’t think it was
d.
was not reasonable from the consumers’ point of view
e.
was not deceptive because the claim was merely false but did not omit any
important information
(a; difficult; p. 85; LO2; AACSB Reflective Thinking)
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Chapter Three: Advertising and Society
118.
The Federal Trade Commission investigated a claim made in an ad for Ultra
Slimfast and determined that the ad is deceptive. What’s the first remedy that will
be taken by the FTC?
a.
issue a cease-and-desist order
b.
fine the advertiser $10,000 for every day the ad has run
c.
require the advertiser to run corrective advertising
d.
order the advertiser to refund consumers’ money
e.
issue a consent decree
(e; moderate; p. 85; LO2; AACSB Communication)
119.
Several countries have banned many forms of tobacco advertising. However, the
Salem, Benson & Hedges, and Winston names can found on billboards in one of
these countries, but they are not advertising cigarettes. They are advertising their
travel, clothing, and restaurant businesses. What type of advertising are these
companies using to undermine these tobacco-advertising bans?
a.
stealth advertising
b.
deceptive advertising
c.
indirect advertising
d.
unfair advertising
e.
imperialistic advertising
(c; moderate; p. 83; LO2; AACSB Ethical Reasoning)
120.
Several companies, such as Procter & Gamble, General Foods, and ColgatePalmolive, have their own codes of behavior and criteria that determine whether
advertisements are acceptable. Which type of self-regulation is this?
a.
industry self-regulation
b.
self-discipline
c.
self-regulation with outside help
d.
personal ethic
e.
social ethic
(b; moderate; p. 89; LO2; AACSB Ethical Reasoning)
121.
John works for an advertising agency whose client wants to reach Hispanic
consumers living in Florida and Texas. He decides that one ad execution is
sufficient because he believes that all Hispanics are the same. John is using a(n)
_________________ to make his decision.
a.
heuristic
b.
shortcut
c.
unethical basis
d.
stereotype
e.
decision-making process
(d; easy; p. 71; LO1; AACSB Communication
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122.
Ads that present women as obsessed with men treat women ________.
a.
fairly
b.
as sexual objects
c.
as homosexuals
d.
as sweetcakes
e.
as pumpkins
(b; moderate; p. 71; LO2; AACSB Ethical Reasoning)
Charley’s Fish Fry restaurant claims it has the “best seafood in town.” What type
of claim does the Federal Trade Commission consider this to be?
a.
deceptive
b.
comparative
c.
puffery
d.
subliminal
e.
indirect
(c; moderate; p. 74; LO2; AACSB Reflective Thinking)
123.
124.
Bayer Aspirin claims that it relieves headache pain three times faster than does
Tylenol, but this is not true. Under which law can Tylenol file a false advertising
lawsuit about this false claim?
a.
Lanham Act
b.
Pure Food and Drug Act
c.
Wheeler-Lea Amendment
d.
FTC Improvement Act
e.
Magnuson-Moss Warranty Act
(a; moderate; pp. 75-76; LO2; AACSB Reflective Thinking)
125.
Which of the following is NOT one of the American Association of Advertising
Agencies’ Ten Guidelines for Comparative Advertising?
a.
The intent and connotation of the ad should be to inform and never to
discredit or unfairly attack competitors, or competing products or services.
b.
Should not include statements, suggestions, or pictures offensive to public
decency or minority segments of the population if they do not use the
competitive product.
c.
When a competitive product is named, it should be one that exists in the
marketplace as significant competition.
d.
The identification should be for honest comparison purposes and not
simply to upgrade by association.
e.
The property being compared should be significant in terms of value or
usefulness of the product to the consumer.
(b; difficult; p. 76 [Table 3.1]; LO3; AACSB Ethical Reasoning)
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Chapter Three: Advertising and Society
126.
In a focus group of women in their 50s, participants objected to health care ads
showing older women with arthritis in sedentary positions. They would prefer to
see the women working out in a gym. This is an example of ________.
a.
marketing imperialism
b.
cultural differences
c.
deceptive advertising
d.
ethnic stereotyping
e.
age-related stereotypes
(e; moderate; p. 73; LO1; AACSB Communication)
APPLICATION QUESTIONS: MINI-CASE MULTIPLE-CHOICE
Prior to 1997, broadcast ads for prescription drugs could not mention the ailment for
which the drug received FDA approval for and the name of the drug in the same
advertisement. That is, only one or the other could be mentioned, which led to much
confusion on the part of consumers. In 1997, the Food and Drug Administration loosened
its controls on pharmaceutical companies, and as a result, the amount of prescription drug
advertising on television has skyrocketed. Now both the ailment and the name of the drug
can be mentioned, but major side effects must also be mentioned and there must be an
indication where the consumer can get more information, such as from a magazine ad or
a web site. Some have been quite critical of this direct-to-consumer prescription
advertising, claiming it has led to an increase in requests for costlier drugs, when the less
expensive generic drug would be just as effective.
127.
Mini-Case Question. Although some doctors appreciate that the advertising has
caused consumers to become more active in managing their own health and more
informed about their drug options, some claim that they are being pressured to
write inappropriate prescriptions because their patients are influenced by the drug
ad claims. What is this called when an external message, like an advertisement,
causes people to feel a need to buy and use a product?
a.
demand creation
b.
manipulation
c.
indirect advertising
d.
want creation
e.
need creation
(a; moderate; p. 66; LO1; AACSB Analytical Skills)
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128.
Mini-Case Question. One ad for a drug used to overcome male erectile
dysfunction depicted an old man in a nursing home acting like a young gigolo
chasing after several women at once and was not allowed to air on the major
television networks of NBC, CBS, and ABC. The ad did not contain any
deceptive or unsubstantiated claims, so there was nothing untruthful in the ad.
Furthermore, the ad followed the guidelines given by the FDA regarding
broadcast advertising by indicating the major side effects and referring to a
magazine ad for more information. How can this happen in the United States if
this is legal advertising of a legal product?
a.
Stereotypes of “dirty old men” are not allowed in any advertising.
b.
The National Advertising Division determined the ad was distasteful and
disallowed it from being aired on television.
c.
Not all advertising is given the same protection under the First
Amendment of the Constitution.
d.
The media can reject ads that violate their standards of good taste.
e.
The behavior portrayed by the old man did not reflect the real behavior of
the individual involved.
(d; difficult; p. 88; LO2; AACSB Reflective Thinking)
129.
Mini-Case Question. Pfizer is a large pharmaceutical company that has
dramatically increased its direct-to-consumer television advertising of
prescription drugs. However, Pfizer has stringent in-house ad review procedures,
including reviews by agency and client attorneys. Pfizer is concerned that any
claim made in an ad is verifiable and that the ad is executed in good taste. What
type of self-regulation does this illustrate?
a.
industry self-regulation
b.
self-discipline
c.
self-regulation with outside help
d.
mandatory self-regulation
e.
voluntary self-regulation
(b; moderate; p. 89; LO2; AACSB Reflective Thinking)
130.
Mini-Case Question. An advertisement by the manufacturer of Flonase, a
prescription allergy nasal spray, compared its product with another nasal spray on
the market, Nasonex, and claimed that it controlled allergy symptoms for a longer
period of time. The ad was effective, resulting in a 2 percent increase in market
share for Flonase. Manufacturers of Nasonex claimed that the advertisement
misrepresented their product and basically made a false comparison. Under which
law, can the manufacturer of Nasonex seek damages from the manufacturer of
Flonase?
a.
Federal Trade Commission Act
b.
Pure Food and Drug Act
c.
FTC Improvement Act
d.
Wheeler-Lea Amendment
e.
Lanham Act
(e; difficult; pp.75-76; LO2; AACSB Communication)
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Chapter Three: Advertising and Society
APPLICATION QUESTIONS: SHORT-ANSWER
131.
Explain the importance of avoiding age-related stereotypes that includes
presenting mature people in a negative light.
Answer:
Senior citizens are often subject to stereotyping. This is a growing segment of the
population with increasing amounts of disposable income. The needs of the
maturing consumer depend on mental and physical acuity. Whether the senior is
an empty–nester whose children recently left home or a widow who needs
assisted living impacts how, when and why goods and services are purchased.
(moderate; p. 73; LO1; AACSB Ethical Reasoning)
132.
You, as a consumer, think that an advertisement you saw on television for a
national brand is making a false claim. What can you do about it?
Answer:
Consumers can:
(1)
Contact the allegedly offending advertiser (choice not discussed in book)
(2)
File a complaint with the appropriate federal regulating agency (i.e., the
Federal Trade Commission)
(3)
File a complaint with the National Advertising Review Council through
the Council of Better Business Bureaus
(moderate; pp. 85, 89; LO2; AACSB Reflective Thinking)
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133.
Procter & Gamble is concerned about a claim made in a rival’s advertisement.
P&G thinks that their claim is deceptive. If P&G does not want to get the
government involved in this dispute, what course of action can P&G take to
resolve this issue and what process will be followed?
Answer:
P&G can file a complaint with the National Advertising Division (NAD), which
is the investigative arm of the National Advertising Review Council (NARC).
This organization is an industry self-regulatory body and has no legal authority
over advertisers, but it negotiates voluntary withdrawal of national advertising
that professionals consider deceptive. The NAD will evaluate the complaint
submitted by P&G and may ask the allegedly deceptive advertiser to substantiate
the claim in question made in the advertisement. If such substantiation is deemed
inadequate, the NAD will ask the advertiser to change or withdraw the offending
ad. When a satisfactory resolution cannot be found, NAD refers the case to the
National Advertising Review Board (NARB), which is the appellate arm of the
NARC. The NARB will form a panel of five people to review the case (three
advertisers, one agency person, and one public representative). This NARB panel
reviews the complaint and the NAD staff findings and holds hearings to let the
advertiser present its case. If the case remains unresolved after the process, the
NARB can publicly identify the advertiser and the facts about the case and
possibly refer the complaint to the appropriate government agency (usually the
FTC).
(moderate; pp. 89-90; LO2; AACSB Reflective Thinking)
134.
Belinda has been invited to speak to an advertising trade group about key ethical
issues facing advertising decision makers. List four key ethical issues that
challenge the standards of advertising professionals.
Answer:
Students can list any four of the six key ethical issues discussed in this chapter:
(1)
Taste and offensive advertising
(2)
Stereotyping
(3)
Body and self-image problems
(4)
Targeting strategies, particularly targeting children
(5)
Problems with advertising claims and other message strategies, such as
puffery, comparative advertising, endorsement, and demonstrations
(6)
Marketing of controversial products, such as unhealthy or dangerous
products (tobacco, alcohol, prescription drugs)
(moderate; p. 69; LO1; AACSB Ethical Reasoning)
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Chapter Three: Advertising and Society
135.
Kim and her boyfriend were watching a movie on television when a commercial
for a feminine hygiene product came on. Kim was actually interested in this
product, but being a teenager, she was mortified that her boyfriend was there
when this ad came on, so she quickly changed the channel. What key ethical issue
challenging the standards of advertising professionals does this best portray?
Answer:
This example is a good illustration of the “poor taste and offensive advertising”
key ethical issue facing advertising professionals. This ad might not be considered
offensive or in poor taste by Kim if her boyfriend was not present, but it made her
uncomfortable because he was there when it came on the television.
(easy; pp. 69-70; LO1; AACSB Ethical Reasoning)
136.
OfficeMax has an advertisement that shows an African American with a bushy,
1970s-era Afro hairdo dancing among office cubicles when he dispenses office
supplies to fellow employees. The music he is dancing to is a famous song,
“Rubberband Man,” recorded by an African American singer. While OfficeMax
claims this ad has been received favorably by consumers, it seems as though the
response could have gone the other way. Explain why.
Answer:
This ad illustrates one of the key ethical issues facing advertising professionals:
stereotyping. Some could argue that OfficeMax is using a racial and ethnic
stereotype of an African American dancing around in a low-level position in an
organization. The stereotype is further exaggerated with the 1970s Afro hairdo.
(moderate; pp. 71-72; LO1; AACSB Ethical Reasoning)
137.
When an advertisement aimed at males portrays females as sexual objects, is it
misuse or good targeting?
Answer:
This ethical dilemma continues to challenge the industry because the technique
tends to succeed at getting the attention of men who are the target for these ads.
The issue is whether the sex appeal is gratuitous, in other words, is it relevant to
the product? Even if it is relevant, does it degrade women? Because what’s
degrading to one person may not be offensive to another, this decision needs to be
made based on research that determines whether most people believe it to be
degrading or offensive. Finally, the advertiser needs to consider whether the brand
meaning is sullied when the advertising uses cheesecake.
(difficult; pp. 70-71; LO1; AACSB Ethical Reasoning)
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138.
Todd just took a job as the manager of a television station. What legal concerns
must he know about advertising to children?
Answer:
In 1990 Congress passed the Children’s Television Advertising Practice Act,
which placed 10.5-minute-per-hour ceilings for commercials in children’s
weekend television programming and 12-minute-per-hour limits for weekday
programs. The act also set rules requiring that commercial breaks be clearly
distinguished from programming, barring the use of program characters to
promote products. He should also know that in 1996, the Federal
Communications Commission began to require all TV stations to air three hours
of children’s educational shows a week.
(difficult; pp. 84-85; LO2; AACSB Communication)
139.
Bob is a brand manager for a national brand laundry detergent and noticed a claim
made in a competitor’s advertisement that falsely indicates that its brand
performed better than his company’s brand. What must Bob’s company prove to
win a false advertising lawsuit under the Lanham Act against the competitor?
Answer:
Under the Lanham Act, companies/plaintiffs are required to prove five elements
to win a false advertising lawsuit about an ad containing a comparative claim:
(1)
False statements have been made about either product
(2)
The ads actually deceived or had the tendency to deceive a substantial
segment of the audience
(3)
The deception was “material” or meaningful (i.e., likely to influence
purchasing intentions)
(4)
Falsely advertised goods are sold in interstate commerce
(5)
The suing company has been or likely will be injured as a result of the
false statements, either by loss of sales or loss of goodwill
(difficult; pp. 75-76; LO2; AACSB Reflective Thinking)
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Chapter Three: Advertising and Society
140.
Many advertisements for weight-loss products feature before-and-after photos of
individuals who have lost an astonishing amount of weight. While these products
may work for some people, the results shown in the ads may not be typical. What
are regulators’ concerns regarding these ads, and how do advertisers of these
products get away with showing such demonstrations?
Answer:
The concern regarding demonstrations is whether the demonstration falsely
upgrades the consumers’ perception of the advertised brand. One technique some
advertisers use to sidestep restrictions on demonstrations is to insert disclaimers
or “supers,” verbal or written words in the ad that indicate exceptions to the
advertising claim made. Notice that on most weight-loss product advertisements
they indicate “results are not typical” or “results might vary.”
(moderate; p. 77; LO2; AACSB Communication)
141.
List five of the ten American Association of Advertising Agencies’ Ten
Guidelines for Comparative Advertising.
Answer:
Students can list any five of the following:
(1)
The intent and connotation of the ad should be to inform and never to
discredit or unfairly attack competing products or services.
(2)
When a competitive product is named, it should be one that exists in the
marketplace as significant competition.
(3)
The competition should be fairly and properly identified but never in a
manner or tone of voice that degrades the competitive product or service.
(4)
The advertising should compare related or similar properties or ingredients
of the product dimension to dimension, feature to feature.
(5)
The identification should be for honest comparison purposes and not
simply to upgrade by association.
(6)
If a competitive test is conducted, it should be done by an objective testing
service.
(7)
In all cases the test should be supportive of all claims made in the
advertising that are based on the test.
(8)
The advertising should never use partial results or stress insignificant
differences to cause the consumer to draw an improper conclusion.
(9)
The property being compared should be significant in terms of value or
usefulness of the product to the consumer.
(10) Comparisons delivered through the use of testimonials should not imply
that the testimonial is more than one individual’s unless that individual
represents a sample of the majority viewpoint.
(difficult; p. 76 [Table 3.1] ; LO2; AACSB Ethical Reasoning)
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142.
In 1997, the Food and Drug Administration loosened its controls on
pharmaceutical companies, and as a result, the amount of prescription drug
advertising has skyrocketed. Discuss some pros and cons regarding this growth in
prescription drug advertising.
Answer:
Pros: Some doctors appreciate that the advertising has caused consumers to
become more active in managing their own health and more informed about their
drug options.
Cons: One study found that direct-to-consumer prescription drug advertising has
led to an increase in requests for costlier drugs, when the less expensive generic
drug would be just as effective. For this reason, consumer groups, government
agencies, and insurance companies have been quite critical of this advertising.
Some doctors also claim that they are being pressured to write inappropriate
prescriptions because their patients are influenced by the drug ad claims. These
arguments tend to support the demand creation criticism of advertising.
(moderate; p. 79; LO2; AACSB Reflective Thinking)
143.
You are just starting out in an advertising career and are concerned about making
ethical decisions. What resources are available to help guide you to a “right”
decision, and what type of criteria might you consider when making an
advertising decision?
Answer:
There are laws and regulations governing the practice of advertising, but there are
also codes of conduct, as well as personal and professional decision-making
guidelines. Three types of criteria need to be considered when making an
advertising decision:
(1)
The Social Responsibility—Social responsibility motivates a business to
perform a useful function within society and to make its impact on society
positive rather than negative—and that includes its advertising as well as
other business practices.
(2)
The Professional Ethics—Professional ethics are often expressed in a code
of standards that identifies how professionals in the industry should
respond when faced with ethical standards .
(3)
The Personal Ethics—Personal judgment and moral reasoning rest on an
intuitive sense of right and wrong.
(moderate; pp. 69, 91-93; LO3; AACSB Reflective Thinking)
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Chapter Three: Advertising and Society
144.
List the five specific statements of the American Association of Advertising
Agencies’ Creative Code.
Answer:
Specifically, we will not knowingly create advertising that contains:
(1)
False, or misleading statements or exaggerations, visual or verbal
(2)
Testimonials that do not reflect the real opinion of the individuals
involved,
(3)
Price claims that are misleading
(4)
Claims insufficiently supported or that distort the true meaning or
practicable application of statements made by professional or scientific
authority
(5)
Statements, suggestions, or pictures offensive to public decency or
minority segments of the population
(difficult; p. 93 [Figure 3.3]) ; LO3; AACSB Ethical Reasoning)
145.
List three ethical questions, given in the “Practical Tips” box, in terms of the
social impact advertising professionals can ask themselves as they confront
ethical dilemmas.
Answer:
The “Practical Tips” box provides seven questions regarding advertising’s social
impact, only three of which are necessary to correctly answer this question:
In terms of its social impact, does advertising ________?
(1)
violate public standards of good taste
(2)
reinforce negative stereotypes
(3)
damage people’s self-image and create insecurities
(4)
promote materialism
(5)
create false wants and false hopes
(6)
contribute to cultural pollution
(7)
market dangerous products
(difficult; p. 94; LO3; AACSB Communication)
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Part One: A Passion for the Business
146.
Explain the distinctions between ethics and morals.
Answer:
Ethics are the "shoulds and oughts" of behavior. Ethics are the "right thing to do."
Ethics and morals are closely related, but not synonymous. Morals are
frameworks for right actions and are more the domain of religion. Moral systems
provide a framework for behavior. Ethics differ from morals in that ethics are not
so much about what is right and wrong, but about making choices from equally
compelling options--- how should you behave when the answer is unclear?
(moderate; p. 91; LO3; AACSB Ethical Reasoning)
APPLICATION QUESTIONS: MINI-CASE SHORT ANSWER
Amy is seven years old and loves to play with dolls. In fact, she has more than 20 Barbie
dolls and lots of clothes and accessories, including three cars, a house with furniture, and
an airplane. Mattel, the manufacturer of Barbie, also sells many other products with the
Barbie brand, such as games, notebooks, and girls’ clothing to name a few.
147.
Mini-Case Question. Amy saw a commercial on television for a newer Barbie
house than the one she currently has, and of course, she wanted it. Advertising has
been criticized because it is used to drive people to feel a need or want. What is
this called and why is advertising criticized?
Answer:
Demand creation means using an external message to drive people to feel a need
or want. Demand creation becomes a question of ethics when social critics charge
that the demand is artificial and the products really aren’t needed—that people’s
wants are being manipulated unnecessarily.
(moderate; p. 66; LO1; AACSB Communication)
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Chapter Three: Advertising and Society
148.
Mini-Case Question. One ad for Barbie showed an animated Barbie character
diving off of a diving board doing flips and twists before landing in a pool. The ad
was advertising a Barbie doll with a diving board that can be attached to the side
of a bathtub, and Amy begged her mother for the doll and got it, but she was very
disappointed when the doll did not perform like she saw in the commercial. She
realized she had to hold on to the doll to make it flip around and dive into the
water. What was wrong with this ad?
Answer:
This scenario is getting at the issue of deceptive advertising. The FTC’s policy on
deception contains three basic elements:
(1)
Misleading—Where there is representation, omission, or practice, there
must be a high probability that it will mislead the consumer. In this
example, the animated Barbie character could be construed as misleading
because the doll could not actually do what was shown in the
advertisement.
(2)
Reasonableness—The perspective of the “reasonable consumer” is used to
judge deception, and in this case, a young girl would be considered the
“reasonable consumer.”
(3)
Injurious—The deception must lead to material injury. That is, it must
influence consumers’ decision making about products and services. In this
case, Amy saw the ad and thought the doll could do the stunts depicted
and begged her mother to buy it for her.
(moderate; p. 85; LO2; AACSB Communication)
149.
Mini-Case Question. What self-regulatory agency monitors national advertising
targeted at children?
Answer:
The Children’s Advertising Review Unit (CARU), which is a subgroup of the
National Advertising Division (NAD) of the Council of Better Business Bureaus.
(moderate; p. 84; LO2; AACSB Analytical Skills)
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Part One: A Passion for the Business
150.
Mini-Case Question. Amy’s mother limits Amy’s television viewing time
because she feels there is just too much advertising influencing her child to want
more stuff. However, there are restrictions regarding advertising toward children.
Name and describe the laws and regulations specific to television advertising
targeted at children.
Answer:
In 1990 Congress passed the Children’s Television Advertising Practice Act,
which placed 10.5-minute-per-hour ceilings for commercials in children’s
weekend television programming and 12-minute-per-hour limits for weekday
programs. The act also set rules requiring that commercial breaks be clearly
distinguished from programming, barring the use of program characters to
promote products.
(moderate; p. 84; LO2; AACSB Reflective Thinking)
110
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