Unfair Trade Practices

Description: This quiz covers various aspects of unfair trade practices in India, including misleading advertisements, false representations, and other deceptive practices.
Number of Questions: 15
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Tags: consumer protection law unfair trade practices indian law
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Which of the following is an example of a misleading advertisement?

  1. A company claims that its product is the best on the market, even though there is no evidence to support this claim.

  2. A company uses a celebrity endorsement to promote its product, even though the celebrity has no experience with the product.

  3. A company advertises a product at a low price, but then charges extra for shipping and handling.

  4. All of the above.


Correct Option:
Explanation:

All of the options are examples of misleading advertisements, which are a type of unfair trade practice.

What is the purpose of the Consumer Protection Act, 1986?

  1. To protect consumers from unfair trade practices.

  2. To promote competition in the marketplace.

  3. To regulate the sale of goods and services.

  4. All of the above.


Correct Option:
Explanation:

The Consumer Protection Act, 1986 is a comprehensive law that aims to protect consumers from unfair trade practices, promote competition in the marketplace, and regulate the sale of goods and services.

Which of the following is an example of a false representation?

  1. A company claims that its product is made in the USA, even though it is actually made in China.

  2. A company claims that its product is backed by a warranty, even though there is no such warranty.

  3. A company claims that its product is safe for children, even though it contains harmful ingredients.

  4. All of the above.


Correct Option:
Explanation:

All of the options are examples of false representations, which are a type of unfair trade practice.

What is the penalty for engaging in unfair trade practices?

  1. A fine of up to Rs. 10 lakh.

  2. Imprisonment for up to 3 years.

  3. Both a fine and imprisonment.

  4. None of the above.


Correct Option:
Explanation:

The penalty for engaging in unfair trade practices is a fine of up to Rs. 10 lakh, imprisonment for up to 3 years, or both.

Who can file a complaint against a company for engaging in unfair trade practices?

  1. Any consumer who has been affected by the unfair trade practice.

  2. A consumer organization.

  3. The government.

  4. All of the above.


Correct Option:
Explanation:

Any consumer who has been affected by an unfair trade practice, a consumer organization, or the government can file a complaint against the company.

What is the time limit for filing a complaint against a company for engaging in unfair trade practices?

  1. 2 years from the date of the unfair trade practice.

  2. 3 years from the date of the unfair trade practice.

  3. 5 years from the date of the unfair trade practice.

  4. There is no time limit.


Correct Option:
Explanation:

The time limit for filing a complaint against a company for engaging in unfair trade practices is 3 years from the date of the unfair trade practice.

Which of the following is an example of a deceptive practice?

  1. A company uses a pyramid scheme to sell its products.

  2. A company uses bait-and-switch tactics to sell its products.

  3. A company uses high-pressure sales tactics to sell its products.

  4. All of the above.


Correct Option:
Explanation:

All of the options are examples of deceptive practices, which are a type of unfair trade practice.

What is the difference between a misleading advertisement and a false representation?

  1. A misleading advertisement is an advertisement that is likely to deceive consumers, while a false representation is a statement that is false or misleading.

  2. A misleading advertisement is an advertisement that is intended to deceive consumers, while a false representation is a statement that is made without regard to its truth or falsity.

  3. A misleading advertisement is an advertisement that is made without regard to its truth or falsity, while a false representation is a statement that is intended to deceive consumers.

  4. There is no difference between a misleading advertisement and a false representation.


Correct Option:
Explanation:

A misleading advertisement is an advertisement that is likely to deceive consumers, while a false representation is a statement that is false or misleading.

What is the purpose of the Unfair Trade Practices Act, 1966?

  1. To protect consumers from unfair trade practices.

  2. To promote competition in the marketplace.

  3. To regulate the sale of goods and services.

  4. All of the above.


Correct Option:
Explanation:

The purpose of the Unfair Trade Practices Act, 1966 is to protect consumers from unfair trade practices.

Which of the following is an example of a pyramid scheme?

  1. A company recruits new members by promising them a share of the profits from the sales of other members.

  2. A company sells its products at a discount to members who recruit new members.

  3. A company pays its members a commission for each new member they recruit.

  4. All of the above.


Correct Option:
Explanation:

All of the options are examples of pyramid schemes, which are a type of deceptive practice.

What is the difference between bait-and-switch tactics and high-pressure sales tactics?

  1. Bait-and-switch tactics involve advertising a product at a low price to attract customers, but then switching to a higher-priced product when the customer arrives at the store.

  2. High-pressure sales tactics involve using aggressive and persuasive techniques to convince a customer to buy a product.

  3. Both of the above.

  4. None of the above.


Correct Option:
Explanation:

Bait-and-switch tactics involve advertising a product at a low price to attract customers, but then switching to a higher-priced product when the customer arrives at the store. High-pressure sales tactics involve using aggressive and persuasive techniques to convince a customer to buy a product.

What are some of the common unfair trade practices used by businesses?

  1. False advertising.

  2. Bait-and-switch tactics.

  3. High-pressure sales tactics.

  4. Pyramid schemes.

  5. All of the above.


Correct Option:
Explanation:

All of the options are common unfair trade practices used by businesses.

What are some of the consequences of unfair trade practices?

  1. Consumers may be misled into buying products or services that they do not need or want.

  2. Consumers may pay more for products or services than they are worth.

  3. Consumers may be harassed or pressured into buying products or services.

  4. All of the above.


Correct Option:
Explanation:

All of the options are consequences of unfair trade practices.

What can consumers do to protect themselves from unfair trade practices?

  1. Be aware of the different types of unfair trade practices.

  2. Shop around and compare prices before making a purchase.

  3. Read the fine print before signing any contracts.

  4. File a complaint with the appropriate authorities if you believe you have been the victim of an unfair trade practice.

  5. All of the above.


Correct Option:
Explanation:

All of the options are things that consumers can do to protect themselves from unfair trade practices.

What are some of the challenges in enforcing unfair trade practices laws?

  1. It can be difficult to prove that a business has engaged in an unfair trade practice.

  2. Businesses may find ways to circumvent the law.

  3. Consumers may be reluctant to file complaints against businesses.

  4. All of the above.


Correct Option:
Explanation:

All of the options are challenges in enforcing unfair trade practices laws.

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