Advertising and Sales Practices Flashcards
7 cards from real DMV practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Advertising and Sales Practices flashcards as text
A dealer advertises a vehicle at a specific price but refuses to sell it at that price when a customer arrives. This practice is known as:
Answer: Bait and switch
Bait and switch involves advertising a product at an attractive price to lure customers, then refusing to sell at that price or pushing them toward a more expensive item.
Which federal agency has primary authority over deceptive automotive advertising practices?
Answer: Federal Trade Commission (FTC)
The FTC has primary authority to regulate deceptive advertising and unfair business practices, including those in the automotive industry.
When advertising a monthly payment on a vehicle, a dealer MUST also disclose:
Answer: The total number of payments and total amount financed
Truth in Lending Act (TILA) requires that when a payment amount is advertised, the total number of payments and total financed amount must also be clearly disclosed.
A dealership's internet ad for a vehicle fails to include the dealer's license number as required by state law. This advertisement is:
Answer: A violation regardless of whether the price is accurate
Omitting a required dealer license number is a regulatory violation independent of whether other ad content is accurate.
A dealer promotes a vehicle as having a 'manufacturer's warranty' when only a limited dealer warranty applies. This is an example of:
Answer: Material misrepresentation
Falsely claiming a manufacturer's warranty when only a limited dealer warranty exists is material misrepresentation because it affects a consumer's purchase decision.
Under the FTC Used Car Rule, dealers are required to display a Buyers Guide on used vehicles that includes:
Answer: Whether the car is sold 'as is' or with a warranty
The FTC Buyers Guide must state whether the car is sold 'as is' or with a dealer warranty, and must describe any warranty coverage provided.
A dealer advertises '0% financing for 60 months' but only customers with excellent credit qualify. The ad must:
Answer: Clearly disclose that the offer is subject to credit approval
Credit-based financing offers must clearly disclose eligibility requirements so consumers are not misled into believing everyone qualifies.