Sales Ethics and Compliance Flashcards
7 cards from real CSA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Sales Ethics and Compliance flashcards as text
A salesperson is approached by a customer who wants to buy in bulk specifically to resell the product at a higher price, but the rep's agreement prohibits resale. What should the rep do?
Answer: Decline the sale and explain that the resale prohibition applies
Selling to a buyer you know intends to violate contract terms makes you complicit in the breach; the sale should be declined.
What is the purpose of a non-disclosure agreement (NDA) in a sales context?
Answer: To protect confidential business information shared during the sales process
NDAs in sales protect sensitive information — such as pricing, product roadmaps, or proprietary processes — shared between parties during negotiations.
Under ethical sales standards, what should a salesperson do when they realize they lack the expertise to answer a customer's technical question accurately?
Answer: Acknowledge the limitation and connect the customer with a subject matter expert
Honest acknowledgment of knowledge limits and timely access to expert resources builds customer trust and prevents inaccurate claims.
Which of the following is an example of an illegal tying arrangement under antitrust law?
Answer: Requiring customers to buy an unwanted product as a condition of purchasing a desired product
Tying arrangements force buyers to purchase a secondary product as a condition of obtaining the product they actually want, which can violate antitrust laws.
A sales representative discovers that a colleague is inflating expense reports. According to most corporate ethics policies, the rep should:
Answer: Report the misconduct through the appropriate internal compliance channel
Most ethics policies require employees to report known misconduct through established channels such as a compliance hotline or ethics officer.
What is the significance of the 'cooling-off rule' enforced by the FTC for door-to-door sales?
Answer: It gives consumers three business days to cancel purchases of $25 or more made at home or temporary locations
The FTC's Cooling-Off Rule provides consumers a 3-business-day cancellation right for sales of $25 or more made outside a seller's permanent place of business.
A salesperson is offered equity in a customer's startup in exchange for favorable pricing on an ongoing contract. This arrangement most likely violates:
Answer: Conflict of interest policies and potentially securities regulations
Accepting equity from a customer in exchange for pricing favors creates a direct conflict of interest and may trigger additional securities and disclosure obligations.