CSA Sales Ethics and Compliance 2 — Questions and Answers
Question 1: A customer asks you to match a competitor's price that seems impossibly low. You suspect the competitor is violating minimum advertised price (MAP) policies. What is the most ethical response?
- Match the price to make the sale
- Explain your pricing policy and the value you offer without disparaging the competitor (Correct answer)
- Report the competitor to the manufacturer immediately
- Tell the customer the competitor is lying about the price
Correct answer: Explain your pricing policy and the value you offer without disparaging the competitor
The ethical approach is to explain your own pricing and value proposition without making unverified accusations about a competitor.
Question 2: Which federal law prohibits deceptive practices in consumer transactions and gives the FTC authority to regulate unfair business practices?
- The Sherman Antitrust Act
- The FTC Act of 1914 (Correct answer)
- The Consumer Credit Protection Act
- The Robinson-Patman Act
Correct answer: The FTC Act of 1914
The Federal Trade Commission Act of 1914 established the FTC and prohibits unfair or deceptive acts or practices in commerce.
Question 3: A salesperson offers a key customer a gift valued at $150 during a holiday promotion. The customer's company policy prohibits gifts over $50. What should the salesperson do?
- Give the gift anyway since it is a promotion, not a bribe
- Respect the customer's company policy and offer something within the $50 limit or nothing at all (Correct answer)
- Split the gift into multiple smaller items to stay under the limit
- Ask the customer to accept it unofficially
Correct answer: Respect the customer's company policy and offer something within the $50 limit or nothing at all
Salespeople must respect the procurement and ethics policies of their customers' organizations, not just their own company's rules.
Question 4: What does the term 'bait and switch' refer to in sales compliance?
- Offering a trade-in allowance on old merchandise
- Advertising a product at a low price then steering customers to a higher-priced item (Correct answer)
- Switching sales territories without notice
- Offering a rebate that expires quickly
Correct answer: Advertising a product at a low price then steering customers to a higher-priced item
Bait and switch is an illegal practice where a low-priced item is advertised to attract customers who are then pushed toward a more expensive product.
Question 5: Under the Telephone Consumer Protection Act (TCPA), what must a business do before sending marketing text messages to consumers?
- File a notice with the FTC
- Obtain prior express written consent from the recipient (Correct answer)
- Provide a 48-hour opt-out window after sending
- Register with the National Do Not Call Registry
Correct answer: Obtain prior express written consent from the recipient
The TCPA requires businesses to obtain prior express written consent before sending automated marketing text messages to consumers.
Question 6: A sales rep discovers that their company has been overcharging a group of customers due to a billing system error. The affected customers have not noticed. What is the ethical obligation?
- Wait to see if customers complain before taking action
- Report the error to management and initiate refunds for all affected customers (Correct answer)
- Correct only future invoices to avoid drawing attention to past overcharges
- Offset the overcharges against future discounts silently
Correct answer: Report the error to management and initiate refunds for all affected customers
Ethical sales practice requires proactive disclosure and correction of errors, even when customers have not detected the problem.
Question 7: Which practice best demonstrates integrity in handling competitive intelligence?
- Posing as a potential customer to gather competitor pricing
- Reviewing publicly available competitor marketing materials and pricing (Correct answer)
- Hiring a former competitor employee specifically to obtain trade secrets
- Accessing a competitor's internal database using a shared industry login
Correct answer: Reviewing publicly available competitor marketing materials and pricing
Reviewing publicly available information is legal and ethical; misrepresentation, theft of trade secrets, and unauthorized access are all violations.
CSA Sales Ethics and Compliance 2
A customer asks you to match a competitor's price that seems impossibly low.
You suspect the competitor is violating minimum advertised price (MAP) policies.
What is the most ethical response?