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Unit 5- Be a Critical Consumer

Section 3.2 Government and Consumer Protection. Unit 5- Be a Critical Consumer . Section 3.2 Government and Consumer Protection. Goals: Identify government agencies and laws that help protect consumers. Describe the different types of product warranties and how they protect consumers.

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Unit 5- Be a Critical Consumer

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  1. Section 3.2 Government and Consumer Protection Unit 5- Be a Critical Consumer

  2. Section 3.2Government and Consumer Protection • Goals: • Identify government agencies and laws that help protect consumers. • Describe the different types of product warranties and how they protect consumers.

  3. Key Terms • Consumer movement • Federal Trade Commission (FTC) • Cease-and-desist order • Consumer Product Safety Commission (CPSC) • Environmental Protection Agency (EPA) • Warranty • Full warranty • Limited warranty • Implied warranty

  4. What is the Consumer Movement? • The consumer movement or consumerism seeks to protect and inform consumers by requiring such practices as honest advertising, product warranties and improved safety standards. • The consumer movement grew our of consumers’ desire for government intervention on their behalf. • Today, consumers and businesses are more equal in power in the American economy than in the past. =

  5. Government Protection • Federal Trade Commission (FTC) : • The most important federal consumer protection agency. • Responsible for protecting consumers from unfair or deceptive business practices. • When the FTC receives a complaint, they investigate. If the company was using deceptive advertising, they issue a cease-and-desist order which requires the company to stop using the ad.Heavy fines are imposed if continued use of the ad.

  6. Government Protection cont….. • Consumer Product Safety Commission (CPSC): • Protects consumers from dangerous products. • Environmental Protection Agency (EPA): • To enforce laws to protect our environment. • Make sure businesses safely dispose of hazardous waste. • Set standards for air and water quality.

  7. Warranties • What is a warranty? • A company’s promise that the product will meet specific standards over a given period of time or the company will repair it, replace it or give a refund.

  8. Law defining warranties. • The Magnuson-Moss Warranty Act in 1975- • A law passed by Congress that specifies how a warranty must be written if the company offers one. • It DOES NOT require all products to carry warranties, it just specifies how it must be written.

  9. WRITTEN WARRANTIES • Full Warranty-promises that a company will • Repair or replace a defective product within a specified time period at no charge. • Must explain how to file a claim. • Must explain how to return the product. • Consumer must receive satisfaction within a reasonable period of time. • Limited Warranty- does not meet the standards of a full warranty because of specific limitations, which must be explained in the warranty.

  10. UNWRITTEN WARRANTY • Implied Warranty- an unwritten guarantee that the product is of sufficient quality to fulfill the purpose for which it was designed

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