Asked by Haris Naeem on May 06, 2024
Verified
To which type of transaction does the negative option rule apply?
A) Subscription to CD or DVD clubs that sends products on a regular basis and require the consumer to opt out of the next shipment
B) Buying used cars
C) Subscription to telephone services
D) Buying goods via telephone or Internet
Negative Option Rule
A regulation by the Federal Trade Commission that prohibits companies from billing consumers for merchandise or services they did not explicitly agree to purchase.
DVD Clubs
Membership-based services or groups that distribute DVDs, often through mail order, allowing members to rent or purchase movies and television shows.
- Understand the regulations and guidelines of the FTC concerning sales and advertising methods.
Verified Answer
VG
Valerie GalindoMay 11, 2024
Final Answer :
A
Explanation :
The negative option rule applies to subscription to CD or DVD clubs that sends products on a regular basis and require the consumer to opt out of the next shipment. This rule requires businesses to obtain a consumer's affirmative consent before charging them for goods or services on an ongoing basis, and to provide clear disclosure and easy cancellation procedures.
Learning Objectives
- Understand the regulations and guidelines of the FTC concerning sales and advertising methods.
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