Advertising & IMC: Principles and Practice, 9e (Moriarty)

Chapter 3 Brand Communication and Society

1) ________ results when an external message drives people to feel a need or want to buy a
product.
A) Demand creation
B) Direct marketing
C) Social marketing
D) Cause marketing
E) Mission marketing
Answer: A
Diff: 1 Page Ref: 65
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
2) 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-corporate debate
D) the personal-versus-social debate
E) the shape-versus-mirror debate
Answer: E
Diff: 2 Page Ref: 66
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
3) 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) symbol
D) mean
E) stereotype
Answer: E
Diff: 1 Page Ref: 68
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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4) Which of the following is a stereotype about women that most commonly appears in
advertisements?
A) women as the decision makers about major purchases
B) women as achievement-oriented
C) women as strong and independent
D) women as participants in sedentary activities
E) women as nurturers
Answer: E
Diff: 2 Page Ref: 69
Skill: Concept
AACSB: Multicultural and diversity understanding
Objective: 3-1
5) Which of the following is a term used to describe what happens when Western culture is
imposed on others?
A) marketing imposition
B) cultural imposition
C) marketing imperialism
D) demand creation
E) marketing elitism
Answer: C
Diff: 1 Page Ref: 70
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
6) 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) cultural imperialism
Answer: E
Diff: 2 Page Ref: 70
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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7) Which of the following is true regarding customs?

A) Customs can be stronger 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.
Answer: A
Diff: 2 Page Ref: 70
Skill: Concept
AACSB: Dynamics of the global economy
Objective: 3-1
8) 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 stereotyping
Answer: E
Diff: 2 Page Ref: 70
Skill: Concept
AACSB: Multicultural and diversity understanding
Objective: 3-1
9) ________ is advertising or other sales representations that praise the item to be sold with
subjective opinions, superlatives, or exaggerations, stating no specific facts.
A) Puffery
B) Manipulative advertising
C) Deceptive advertising
D) Comparative advertising
E) Indirect advertising
Answer: A
Diff: 1 Page Ref: 71
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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10) Under U.S. law, businesses can seek damages from an advertiser who misrepresents the
nature, characteristics, qualities, or geographic origin of a product in ________.
A) puffery
B) mission advertising
C) demand creation
D) comparative advertising
E) claim advertising
Answer: D
Diff: 2 Page Ref: 71
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
11) According to U.S. law, 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.
Answer: C
Diff: 3 Page Ref: 72
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
12) 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
Answer: A
Diff: 1 Page Ref: 72-73
Skill: Concept
AACSB: Communication abilities
Objective: 3-1

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13) A company that pays bloggers to pose as customers and post customer reviews online is
using ________.
A) green marketing
B) cause marketing
C) mission marketing
D) flogging
E) networking
Answer: D
Diff: 2 Page Ref: 73
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
14) Which of the following prohibits consumers from taking cash from manufacturers, suppliers,
or their representatives for making recommendations, reviews, or endorsements, unless full
disclosure is provided?
A) the Word of Mouth Marketing Association's ethics code
B) the Fourth Principle of IMC
C) the American Association of Advertising Agencies' Creative Code
D) the TARES Test of Ethical Advertising
E) the Potter Box
Answer: A
Diff: 2 Page Ref: 73
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
15) Verbal or written words in an advertisement that indicate exceptions to the advertising claim
made are known as ________.
A) ethics
B) puffs
C) endorsements
D) testimonials
E) disclaimers
Answer: E
Diff: 2 Page Ref: 73
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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16) The main concern the FTC has when an advertiser substitutes for products during a
demonstration (such as using a mixture of glue and water instead of ice cream) is ________.
A) whether the substitution is necessary
B) whether the demonstration uses puffery
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
Answer: E
Diff: 3 Page Ref: 73
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
17) Cigarette advertising on ________ has been banned since 1971.
A) radio only
B) television only
C) the Internet only
D) radio and television only
E) radio, television, and the Internet
Answer: D
Diff: 2 Page Ref: 74
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
18) Which is NOT an element of the FDA's 1996 restrictions on tobacco advertising?
A) a ban on all in-store advertising inside of stores 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 provided to fund antismoking ads targeting children
E) a portion of the master settlement agreement dedicated to fund TV and print ads warning
children about the dangers of smoking
Answer: A
Diff: 3 Page Ref: 75
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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19) Which of the following best explains why the amount of prescription drug advertising has
increased since 1997?
A) The American Medical Association approved the use of advertising to promote prescription
drugs.
B) The federal government loosened its controls on the production of prescription drugs.
C) Pharmaceutical companies realized that a pull strategy would be more effective than a push
strategy.
D) The federal government loosened its controls on pharmaceutical advertising.
E) Patents held by many pharmaceutical companies expired, resulting in price competition and
heavy advertising.
Answer: D
Diff: 3 Page Ref: 75
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
20) _______ efforts are typically shorter term than ________ efforts are.
A) Cause marketing; mission marketing
B) Mission marketing; integrated marketing
C) Green marketing; mission marketing
D) Not-for-profit marketing; mission marketing
E) Not-for-profit marketing; cause marketing
Answer: A
Diff: 2 Page Ref: 76
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
21) Which of the following refers to marketing that aligns the basic business practices and
position of a brand with a cause, such as the environment or sustainability?
A) green marketing
B) social marketing
C) integrated marketing
D) mission marketing
E) not-for-profit marketing
Answer: D
Diff: 1 Page Ref: 76
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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22) ________ are the "shoulds" and "oughts" of behavior.

A) Missions
B) Ethics
C) Regulations
D) Customs
E) Traditions
Answer: B
Diff: 1 Page Ref: 76
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
23) ________ are frameworks for right actions and are primarily the domain of religion and
philosophy.
A) Missions
B) Ethics
C) Morals
D) Customs
E) Traditions
Answer: C
Diff: 1 Page Ref: 76
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
24) Which of the following is an example of a moral system?
A) the Ten Commandments
B) the AAAA's Creative Code
C) the TARES Test of Ethical Advertising
D) the Potter Box
E) the Bill of Rights
Answer: A
Diff: 2 Page Ref: 76
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2

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25) With respect to guidelines for determining what is ethical, which is NOT one of the types of
criteria for making an advertising decision?
A) individual moral upbringing
B) self-interest
C) professional ethics
D) industry standards of self-regulation
E) government regulations
Answer: B
Diff: 2 Page Ref: 77
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
26) 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
Answer: D
Diff: 2 Page Ref: 78
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
27) The American Association of Advertising Agencies' Creative Code says that advertising
agencies will not create advertising that has any of the following EXCEPT which one?
A) false or misleading statements
B) puffs
C) price claims that are misleading
D) testimonials that do not reflect the real opinion of the individual involved
E) statements offensive to public decency
Answer: B
Diff: 3 Page Ref: 79
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2

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28) Many professions write a code of ________ to help guide practitioners toward ethical
behavior.
A) morals
B) ethics
C) laws
D) regulations
E) missions
Answer: B
Diff: 2 Page Ref: 79
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
29) Which of the following tools is designed to help marketers and advertising specialists decide
what to do when faced with an ethical dilemma?
A) a SWOT analysis
B) a Potter Box
C) a URL
D) the NARB
E) the BBB
Answer: B
Diff: 2 Page Ref: 80
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
30) Which of the following is NOT an aspect considered in the Potter Box?
A) facts
B) loyalties
C) regulations
D) principles
E) values
Answer: C
Diff: 3 Page Ref: 80
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2

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31) In the TARES Test of Ethical Advertising, TARES stands for ________.
A) tested, authentic, regulated, ethical, and socially responsible
B) tested, aware, reasonable, essential, and socially responsible
C) truthful, aware, reasonable, equitable, and socially responsible
D) truthful, authentic, respectful, equitable, and socially responsible
E) truthful, actionable, rewarding, essential, and socially responsible
Answer: D
Diff: 3 Page Ref: 80
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
32) Government oversight responsibility with respect to advertising includes ________.
A) professional discipline
B) self-regulation
C) laws and regulations
D) right to refuse
E) community group regulation
Answer: C
Diff: 2 Page Ref: 81
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
33) ________ makes laws, and ________ interpret those laws in specific situations.
A) The Supreme Court; the lower courts
B) Congress; the courts
C) The president; the courts
D) The president; the Senate and the House of Representatives
E) Congress; the FTC and the FCC
Answer: B
Diff: 2 Page Ref: 81
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
34) Which arm of the federal government creates laws regarding advertising?
A) executive branch
B) judicial branch
C) Federal Communications Commission
D) Congress
E) Federal Trade Commission
Answer: D
Diff: 2 Page Ref: 81
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
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35) The ________ prohibits unfair and deceptive acts and practices regardless of whether
competition is injured.
A) Lanham Act
B) Wheeler-Lea Amendment
C) National Advertising Review Council
D) Pure Food and Drug Act
E) Magnuson-Moss Act
Answer: B
Diff: 3 Page Ref: 81
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
36) A brand, a 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 called a ________.
A) trademark
B) copyright
C) logo
D) patent
E) brand name
Answer: A
Diff: 1 Page Ref: 82
Skill: Concept
Objective: 3-3
37) 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.
Answer: D
Diff: 3 Page Ref: 82
Skill: Concept
Objective: 3-3

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38) Under which of the following 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
Answer: C
Diff: 3 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
39) A recent trademark issue is protection for URLs, which are ________.
A) patents
B) trademarks
C) Internet domain names
D) self-regulating agencies
E) consumer-interest groups
Answer: C
Diff: 2 Page Ref: 82
Skill: Concept
AACSB: Use of information technology
Objective: 3-3
40) A ________ gives an organization the exclusive right to use or reproduce original work, such
as an advertisement or package design, for a specified period of time.
A) trademark
B) servicemark
C) copyright
D) patent
E) brand name
Answer: C
Diff: 1 Page Ref: 82
Skill: Concept
Objective: 3-3

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41) Which of the following CANNOT be copyrighted?

A) an advertisement
B) an idea
C) a package design
D) an illustration
E) a photograph
Answer: B
Diff: 2 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
42) Controls for copyright protection are provided by the ________.
A) Federal Communications Commission
B) Federal Trade Commission
C) Patent and Trademark Office
D) Department of Commerce
E) Library of Congress
Answer: E
Diff: 3 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
43) 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
Answer: A
Diff: 1 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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44) 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
Answer: A
Diff: 2 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
45) ________ speech is speech that promotes commercial activity.
A) Political
B) Free
C) Unregulated
D) Commercial
E) Regulated
Answer: D
Diff: 1 Page Ref: 82
Skill: Concept
AACSB: Communication abilities
Objective: 3-3
46) In which case did the Supreme Court establish a test that determines to what extent the
government can restrict advertising?
A) Valentine v. Chrestensen (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)
Answer: C
Diff: 3 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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47) ________ advertising features a product other than the primary, and usually controversial,
product.
A) Deceptive
B) Unfair
C) Comparative
D) Injurious
E) Indirect
Answer: E
Diff: 1 Page Ref: 83
Skill: Concept
AACSB: Communication abilities
Objective: 3-3
48) 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
Answer: B
Diff: 1 Page Ref: 84
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
49) 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
Answer: B
Diff: 1 Page Ref: 85
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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50) 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
Answer: C
Diff: 1 Page Ref: 85
Skill: Concept
AACSB: Communication abilities
Objective: 3-3
51) 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 only
Answer: A
Diff: 2 Page Ref: 85
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
52) Which of the following federal agencies regulates direct-mail and magazine advertising, as
well as lotteries?
A) the U.S. Postal Service
B) the Federal Communications Commission
C) the Food and Drug Administration
D) the U.S. Patent and Trademark Office
E) the Library of Congress
Answer: A
Diff: 2 Page Ref: 85
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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53) All EXCEPT which of the following have governmental authority concerning some form of
regulation of advertising?
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
Answer: D
Diff: 2 Page Ref: 85, 89
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
54) Which of the following was NOT required by the Children's Television Advertising Practice
Act of 1990?
A) a 10.5-minute-per-hour ceiling for commercials in children's weekend television
programming
B) three hours of children's educational shows aired by all TV stations each week
C) commercial breaks that are clearly distinguished from programming
D) the barring of the use of children's program characters to promote products in commercials
E) a 12-minute-per-hour limit for commercials in children's weekday television programming
Answer: B
Diff: 3 Page Ref: 86
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
55) Which of the following was the agreement 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
Answer: D
Diff: 3 Page Ref: 86
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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56) Advertising intended to mislead consumers by making claims that are false or by failure to
make full disclosure of important facts, or both, is called ________.
A) puff advertising
B) indirect advertising
C) deceptive advertising
D) unsubstantiated advertising
E) injurious advertising
Answer: C
Diff: 1 Page Ref: 86
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
57) 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) substantiation
E) double jeopardy
Answer: C
Diff: 2 Page Ref: 86
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
58) Which of the following 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
Answer: E
Diff: 2 Page Ref: 87
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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59) A(n) ________ 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) incarceration
Answer: A
Diff: 2 Page Ref: 87
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
60) Which of the following is NOT an FTC course of action for deception and unfair
advertising?
A) consent decrees
B) cease-and-desist orders
C) incarceration
D) corrective advertising
E) consumer redress
Answer: C
Diff: 2 Page Ref: 86-87
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
61) Which of the following statements regarding cease-and-desist orders issued by the Federal
Trade Commission is FALSE?
A) A cease-and-desist order requires 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.
Answer: D
Diff: 3 Page Ref: 84 and 87
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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62) Which of the following is the landmark corrective advertising case?

A) Valentine v. Chrestensen
B) Warner-Lambert v. FTC
C) 44 Liquormart, Inc. v FTC
D) Nike v. FTC
E) Cincinnati v. Discovery Network
Answer: B
Diff: 3 Page Ref: 88
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
63) 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
Answer: B
Diff: 2 Page Ref: 88
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
64) Several companies, such as Procter & Gamble, General Foods, and Colgate-Palmolive, 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
Answer: B
Diff: 2 Page Ref: 88
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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65) When an industry develops, uses, and enforces norms, this is known as which type of selfregulation?
A) industry self-regulation
B) self-discipline
C) social ethic
D) professional ethic
E) personal ethic
Answer: A
Diff: 2 Page Ref: 88
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
66) 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 (AAAA)
D) National Advertising Review Council (NARC)
E) American Advertising Federation (AAF)
Answer: D
Diff: 3 Page Ref: 89
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
67) 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
Answer: A
Diff: 2 Page Ref: 89
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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68) Which arm of the National Advertising Review Council is made up of people from the field
of advertising who evaluate complaints submitted by consumers, consumer groups, industrial
organizations, and advertising firms?
A) National Advertising Division (NAD)
B) National Advertising Review Board (NARB)
C) American Association of Advertising Agencies (AAAA)
D) Federal Trade Commission (FTC)
E) American Advertising Federation (AAF)
Answer: A
Diff: 2 Page Ref: 89
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
69) If the National Advertising Division (NAD) and an 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 (AAAA)
C) Federal Trade Commission (FTC)
D) American Advertising Federation (AAF)
E) Federal Communications Commission (FCC)
Answer: A
Diff: 2 Page Ref: 89
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
70) If the National Advertising Review Board (NARB) and an allegedly deceptive advertiser
cannot reach a satisfactory resolution, the case is referred to the ________.
A) National Advertising Division (NAD)
B) American Association of Advertising Agencies (AAAA)
C) Advertising Review Council (ARC)
D) American Advertising Federation (AAF)
E) appropriate government agency
Answer: E
Diff: 2 Page Ref: 89
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
71) Critics of advertising tend to argue that advertising has power to shape social trends and the
way people think and act.
Answer: TRUE
Diff: 2 Page Ref: 66
Skill: Concept
AACSB: Communication abilities
Objective: 3-1
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72) Stereotypes can be useful and aid communication by using easily understood symbolic
meanings.
Answer: TRUE
Diff: 2 Page Ref: 68
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
73) Marketing imperialism is a term used to describe what happens when Western culture is
imposed on others.
Answer: TRUE
Diff: 1 Page Ref: 70
Skill: Concept
AACSB: Dynamics of the global economy
Objective: 3-1
74) Customs can be even stronger than laws.
Answer: TRUE
Diff: 2 Page Ref: 70
Skill: Concept
AACSB: Dynamics of the global economy
Objective: 3-1
75) Obviously exaggerated "puffing" claims are illegal.
Answer: FALSE
Diff: 2 Page Ref: 71
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
76) According to federal regulations, a spokesperson who endorses a brand must actually use the
brand.
Answer: TRUE
Diff: 2 Page Ref: 73
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
77) A code of ethics identifies how a professional in the industry must respond when faced with
ethical questions.
Answer: FALSE
Diff: 3 Page Ref: 79
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2

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78) A copyright is a brand, corporate or store name, or distinctive symbol that identifies the
seller's brand and thus differentiates it from the brands of other sellers.
Answer: FALSE
Diff: 1 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
79) A trademark must be registered with the Library of Congress.
Answer: FALSE
Diff: 2 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
80) A copyright gives an organization the exclusive right to use or reproduce original work, such
as an advertisement or package design, indefinitely.
Answer: FALSE
Diff: 2 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
81) Common designs or symbols can be copyrighted.
Answer: FALSE
Diff: 2 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
82) Under the First Amendment to the U.S. Constitution, protection of commercial speech is
absolute.
Answer: FALSE
Diff: 2 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
83) The government can ban truthful commercial speech if it can be proven that the public good
demands such restrictions.
Answer: TRUE
Diff: 3 Page Ref: 82
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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84) The Federal Trade Commission (FTC) is the primary agency governing the advertising
industry.
Answer: TRUE
Diff: 2 Page Ref: 84
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
85) A cease-and-desist order given to any firm in an industry applies to all firms in that industry.
Answer: TRUE
Diff: 3 Page Ref: 84
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
86) 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.
Answer: FALSE
Diff: 2 Page Ref: 85
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
87) The Federal Communications Commission (FCC) has the power to ban the airing of
messages, including ads, that are deceptive or in poor taste.
Answer: TRUE
Diff: 2 Page Ref: 85
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
88) The Federal Communications Commission (FCC) has the authority to take legal actions
against advertisers and advertising agencies.
Answer: FALSE
Diff: 3 Page Ref: 85
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
89) To be considered deceptive under FTC policy, a false or misleading advertisement must
influence consumers' decision making about the product or service advertised.
Answer: TRUE
Diff: 2 Page Ref: 86
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
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90) The current FTC policy on deception is clear and easy for advertisers to measure.
Answer: FALSE
Diff: 2 Page Ref: 86
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
91) An advertiser should have data on file to substantiate any claims it makes in its
advertisements.
Answer: TRUE
Diff: 3 Page Ref: 86
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
92) The FTC accepts only research conducted by an independent research firm when
investigating an advertiser's claim substantiation.
Answer: FALSE
Diff: 3 Page Ref: 86
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
93) Advertisers must comply with a consent decree.
Answer: FALSE
Diff: 2 Page Ref: 87
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
94) 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.
Answer: FALSE
Diff: 2 Page Ref: 87
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
95) The process leading to the issuance of a cease-and-desist order is similar to that of a court
trial.
Answer: TRUE
Diff: 2 Page Ref: 87
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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96) An advertising agency can be held liable along with the advertiser for deceptive advertising.
Answer: TRUE
Diff: 2 Page Ref: 87
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
97) The media can reject ads that violate their standards of truth and good taste.
Answer: TRUE
Diff: 2 Page Ref: 88
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
98) Virtually all major advertisers and advertising agencies have in-house ad review procedures,
typically including reviews by agency and client attorneys.
Answer: TRUE
Diff: 2 Page Ref: 88
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
99) 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.
Answer: FALSE
Diff: 2 Page Ref: 89
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
100) The Better Business Bureau is a government agency with the power to oversee advertising,
particularly local advertising.
Answer: FALSE
Diff: 2 Page Ref: 89
Skill: Concept
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
101) Because standards of good taste are generally consistent across a culture, creating general
guidelines for good taste in advertising is straightforward.
Answer: FALSE
Diff: 2 Page Ref: 67
Skill: Application
AACSB: Reflective thinking skills
Objective: 3-1
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102) A cereal maker that advertises its products as "the one that will make you smile" is using an
exaggerated claim, not puffery.
Answer: FALSE
Diff: 3 Page Ref: 71
Skill: Application
AACSB: Analytic skills
Objective: 3-1
103) In advertising, an action that is legal is by definition ethical.
Answer: FALSE
Diff: 3 Page Ref: 76
Skill: Application
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
104) A radio host who makes gender stereotyped references that are in poor taste could face
action from the FTC.
Answer: FALSE
Diff: 3 Page Ref: 85
Skill: Application
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
105) The concern that children may be exploited by certain advertising messages could be
addressed by both the FTC and the FCC.
Answer: TRUE
Diff: 3 Page Ref: 85-86
Skill: Synthesis
AACSB: Reflective thinking skills
Objective: 3-3

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106) Discuss the key ethical issues of taste, stereotyping, use of sex appeal, and targeting
children. How do advertising professionals deal with these issues?
Answer:
(1) Taste and offensive advertising: Advertisers need to consider what might be considered bad
taste or offensive by the target audience. The context in which the ads are viewed is also
relevant.
(2) Stereotyping: Though stereotypes can be useful, this is a delicate area in advertising. Ads
should not use stereotypes that rely on a characteristic that is so negative and exaggerated that it
reduces the group to a caricature.
(3) Body image and sex appeal: Advertising that portrays women or men as sex objects can be
considered demeaning and sexist, particularly if sex is unrelated to the product. Advertisements
also influence cultural concepts of beauty; a focus on body perfection in advertising can lead to
men and women placing their health at risk in order to look like models.
(4) Targeting children: Children are seen as more vulnerable than adult consumers. A current
issue is related to selling soft drinks, candy, and food with high fat and sugar content to children.
Many believe that heavy advertising of such products has added to the growing obesity rate
among the country's children.
Diff: 3 Page Ref: 67-70
Skill: Synthesis
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
107) 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 over this
comparative claim?
Answer: According to federal law, 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.
Diff: 3 Page Ref: 72
Skill: Synthesis
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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108) 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 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 copycat 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.
Diff: 3 Page Ref: 82
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-3
109) Describe three specific responsibilities of the Federal Trade Commission.
Answer: FTC responsibilities include 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.
(3) When a violation is found, mandate a cease-and-desist order, an affirmative disclosure,
and/or corrective advertising.
Diff: 3 Page Ref: 84
Skill: Synthesis
AACSB: Reflective thinking skills
Objective: 3-3

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110) Name and describe four FTC remedies for deception and unfair advertising.
Answer: The FTC can follow several courses of actions:
(1) Consent DecreesThe 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.
(2) Cease-and-Desist OrdersIssued 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-anddesist order is similar to a court trial, in which an administrative law judge presides and lawyers
represent both parties.
(3) Corrective AdvertisingMay 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 RedressThe FTC can order cancellation or reformation of contracts, refund of
money or return of property, payment of damages, and/or public notification.
Diff: 3 Page Ref: 87-88
Skill: Critical Thinking
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
111) 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.
Which side of the social debate on advertising do believers of this statement most likely take?
A) advertising mirrors social values
B) advertising mimics social values
C) advertising shapes social values
D) advertising manipulates social values
E) advertising is offensive
Answer: C
Diff: 2 Page Ref: 66
Skill: Application
AACSB: Reflective thinking skills
Objective: 3-1

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112) 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) substantiation
Answer: D
Diff: 2 Page Ref: 68
Skill: Application
AACSB: Analytic skills
Objective: 3-1
113) 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) endorsement
E) indirect
Answer: C
Diff: 2 Page Ref: 71
Skill: Application
AACSB: Analytic skills
Objective: 3-1
114) Bayer Aspirin claims that it relieves headache pain three times faster than does Tylenol.
What type of advertising is this?
A) comparative
B) testimonial
C) endorsement
D) indirect
E) substantiated
Answer: A
Diff: 2 Page Ref: 71
Skill: Application
AACSB: Analytic skills
Objective: 3-1

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115) Recently, a class-action lawsuit was brought against McDonald's, charging that its food has
contributed to the nationwide obesity epidemic. The suit was eventually dismissed, but many
critics continue to point out the health dangers of typical "fast food" menu items. These critics
are concerned that the fast food industry has used ________.
A) high-pressure selling
B) deceptive promotions
C) deceptive pricing
D) deceptive packaging
E) harmful products
Answer: E
Diff: 2 Page Ref: 74
Skill: Application
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
116) Timberland employees get 40 hours paid leave each year to pursue volunteer projects. The
company runs a service day that hosts projects in 25 countries, and it supports a nonprofit that
brings young people into public service for a year. CEO Jeffrey Swartz sees such service as a
powerful differentiator for Timberland with its current and potential customers. Timberland
could be most accurately described as practicing ________.
A) consumerism
B) green marketing
C) social marketing
D) traditional marketing
E) mission marketing
Answer: E
Diff: 2 Page Ref: 76
Skill: Application
AACSB: Analytic skills
Objective: 3-1
117) A regional supermarket chain runs print, radio, and television advertisements announcing
that 1% of its sales over the next two months will be donated to local after-school programs for
underprivileged youth. This is an example of ________ marketing.
A) cause
B) mission
C) sustainable
D) green
E) integrated
Answer: A
Diff: 2 Page Ref: 76
Skill: Application
AACSB: Analytic skills
Objective: 3-1

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118) A company that practices green marketing would likely be LEAST concerned about which
of the following?
A) recycling programs
B) environmentally sustainable strategies
C) social responsibility
D) URL copyrights
E) biodegradability
Answer: D
Diff: 2 Page Ref: 76
Skill: Application
AACSB: Reflective thinking skills
Objective: 3-1
119) Which of the following is the best example of a company using green marketing?
A) a company adopting a code of marketing ethics
B) a company contributing a portion of revenues to a specific nonprofit organization
C) a company making its products out of recycled materials
D) a company making special efforts to hire a multiculturally diverse staff
E) a company using the social marketing concept
Answer: C
Diff: 2 Page Ref: 76
Skill: Application
AACSB: Analytic skills
Objective: 3-1
120) 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, that company would most likely be guilty of ________.
A) comparative advertising
B) competitive infringement
C) misleading advertising
D) trademark infringement
E) deceptive advertising
Answer: D
Diff: 2 Page Ref: 82
Skill: Application
AACSB: Analytic skills
Objective: 3-3

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121) Malaysia has banned many forms of tobacco advertising. However, the name Salema
major cigarette manufacturercan be found in advertisements for a line of clothing sponsored by
the company. Salem is using which of the following to work around the tobaccoadvertising
bans?
A) stealth advertising
B) deceptive advertising
C) indirect advertising
D) unfair advertising
E) imperialistic advertising
Answer: C
Diff: 2 Page Ref: 83
Skill: Application
AACSB: Analytic skills
Objective: 3-3
122) Lovely Locks, a maker of shampoos, is considering entering the cosmetics market. The
company has a line of mascara and eyeliner it wants to introduce. However, first Lovely Locks
must obtain approval from the ________.
A) Environmental Protection Agency
B) Interstate Commerce Commission
C) Food and Drug Administration
D) Federal Trade Commission
E) Federal Communications Commission
Answer: C
Diff: 3 Page Ref: 85
Skill: Application
AACSB: Analytic skills
Objective: 3-3
123) 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
Answer: E
Diff: 2 Page Ref: 87
Skill: Application
AACSB: Reflective thinking skills
Objective: 3-3

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124) In which case did the Supreme Court signal the LEAST protection for commercial speech
under the First Amendment?
A) Valentine v. Chrestensen (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)
Answer: A
Diff: 3 Page Ref: 83
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-3
125) A federal agency ordered KFC to stop running ads with false claims that its fried chicken is
compatible with certain weight loss programs. Which agency had the authority to issue this
order?
A) the Federal Trade Commission
B) the Food and Drug Administration
C) the Consumer Product Safety Commission
D) the Environmental Protection Agency
E) the American Association of Advertising Agencies
Answer: A
Diff: 2 Page Ref: 84
Skill: Synthesis
AACSB: Reflective thinking skills
Objective: 3-3
126) When Kraft foods made a claim that their processed cheese slices contained as much
calcium as 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
Answer: A
Diff: 3 Page Ref: 86
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-2
Use the passage below to answer the following questions.
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Prior to 1997, broadcast ads for prescription drugs could not mention both the ailment for which
the drug received FDA approval 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 drugs would be just as effective.
127) 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) overcommercialization
C) indirect advertising
D) endorsement advertising
E) puffery
Answer: A
Diff: 2 Page Ref: 65
Skill: Application
AACSB: Analytic skills
Objective: 3-1

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128) One ad for a drug used to overcome male erectile dysfunction depicted an old man in a
nursing home acting like a young man chasing after several women at once. The ad 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. Which of the
following best explains why the ad was not allowed to air?
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.
Answer: D
Diff: 3 Page Ref: 88
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-3
129) Pfizer is a large pharmaceutical company that has dramatically increased its direct-toconsumer 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 selfregulation does this illustrate?
A) industry self-regulation
B) self-discipline
C) self-regulation with outside help
D) mandatory self-regulation
E) voluntary self-regulation
Answer: B
Diff: 2 Page Ref: 88
Skill: Application
AACSB: Analytic skills
Objective: 3-3

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130) 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 two
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, Nasonex would have to prove all of the following EXCEPT which one?
A) False statements had been made about Nasonex or Flonase.
B) The ads actually deceived a substantial segment of the audience.
C) Both Nasonex and Flonase are sold in interstate commerce.
D) Nasonex has been injured or is likely to be injured as a result of the false statements.
E) Flonase relied on puffery in the ads.
Answer: E
Diff: 3 Page Ref: 72
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-1
131) 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. She quickly
changed the channel. What key ethical issue challenging the standards of advertising
professionals does this best illustrate?
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.
Diff: 2 Page Ref: 67
Skill: Application
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
132) What are the arguments against using sex appeals in an advertisement for a product that is
not related to sex?
Answer: One argument is that the use of sex appeals may be degrading or sexist. Another
argument is that the irrelevant use of sex in an ad distracts and hinders communication to the
target.
Diff: 3 Page Ref: 68
Skill: Critical Thinking
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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133) OfficeMax has an advertisement that shows an African American with a bushy 1970s-era
Afro hairdo dancing among office cubicles as 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.
Diff: 3 Page Ref: 69-70
Skill: Critical Thinking
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1
134) Explain the importance of avoiding the use of age-related stereotypes in advertisements.
Answer: Senior citizens are a growing segment of the population with increasing amounts of
disposable income. The needs of the maturing consumer depend more on the individual's mental
and physical acuity than on the individual's chronological age, so age-related stereotypes will not
apply to broad segments of the senior population.
Diff: 2 Page Ref: 70
Skill: Synthesis
AACSB: Reflective thinking skills
Objective: 3-1
135) 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 most weightloss product advertisements indicate "results are not typical" or "results might vary."
Diff: 3 Page Ref: 73
Skill: Critical Thinking
AACSB: Ethical understanding and reasoning abilities
Objective: 3-1

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136) 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. What is
an advantage of this regulatory change?
Answer: 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.
Diff: 2 Page Ref: 75
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-1
137) How is the Distilled Spirits Council a model for industry self-regulation?
Answer: The Distilled Spirits Council is a trade organization representing producers and
marketers of distilled spirits sold in the U.S. The organization encourages members to follow
guidelines for responsible practices when advertising; this has led to limited liquor advertising on
television.
Diff: 3 Page Ref: 75
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-1
138) 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. What is
a disadvantage of this regulatory change?
Answer: 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.
Diff: 2 Page Ref: 75
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-1
139) 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.
Diff: 2 Page Ref: 76
Skill: Synthesis
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2

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140) What is the purpose of the American Association of Advertising Agencies' Creative Code?
Answer: The AAAA's Creative Code is the core of the association's Standards of Practice. This
code of ethics establishes guidelines for professionals in the ad industry to follow when faced
with ethical questions.
Diff: 2 Page Ref: 79
Skill: Critical Thinking
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
141) 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?
Diff: 3 Page Ref: 80
Skill: Application
AACSB: Ethical understanding and reasoning abilities
Objective: 3-2
142) Explain the "Reasonableness" element of the current FTC policy on deception.
Answer: 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.
Diff: 3 Page Ref: 86
Skill: Critical Thinking
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3
143) Explain the "Injurious" element of the current FTC policy on deception.
Answer: The deception must lead to material injury. That is, it must influence consumers'
decision making about products and services.
Diff: 3 Page Ref: 86
Skill: Critical Thinking
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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144) 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?
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).
Diff: 2 Page Ref: 89
Skill: Synthesis
AACSB: Reflective thinking skills
Objective: 3-3
145) Todd just took a job as the manager of a television station. What does he need to know
about the station's responsibility for showing children's educational shows?
Answer: Todd needs to know that, based on a 1996 agreement between broadcasters, children's
advocates, and the federal government, all television stations are required to air three hours of
children's educational shows each week.
Diff: 2 Page Ref: 86
Skill: Application
AACSB: Reflective thinking skills
Objective: 3-3
146) 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 a consumer activist group.
(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.
Diff: 3 Page Ref: 89-90
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-3

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Use the information below to answer the following questions.

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) 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 neededthat people's wants are being manipulated
unnecessarily.
Diff: 2 Page Ref: 65
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-1
148) One ad for Barbie shows an animated Barbie character diving off of a diving board doing
flips and twists before landing in a pool. The commercial was advertising a Barbie doll with a
diving board that can be attached to the side of a bathtub. Amy begged her mother for the doll
and got it, but she was very disappointed when the doll did not perform as she had seen it
perform 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 ad was misleading in
that the doll could not actually do what was shown in the advertisement. The perspective of the
"reasonable consumer" is used to judge deception, and in this case, a young girl such as Amy
would be considered the "reasonable consumer." This ad led to material injury, as the ad certainly
influenced Amy's demand for the doll.
Diff: 3 Page Ref: 86
Skill: Critical Thinking
AACSB: Reflective thinking skills
Objective: 3-3
149) What self-regulatory agencies would likely be interested in evaluating advertisements for
Barbie?
Answer: The National Advertising Division (NAD) and the Council of Better Business Bureaus
are two associations that might receive and investigate complaints about such advertisements.
Diff: 2 Page Ref: 89
Skill: Application
AACSB: Reflective thinking skills
Objective: 3-3

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150) 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. Briefly 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.
Diff: 3 Page Ref: 86
Skill: Synthesis
AACSB: Ethical understanding and reasoning abilities
Objective: 3-3

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