Category: Important Questions

TN State Board 12th Commerce Important Questions Chapter 16 Consumerism

Question 1.
Who is a consumer?
Answer:

1. A consumer is one who consumes goods manufactured and sold by others or created by nature and sold by others.
2. A person who buys any goods or services for a consideration which has been paid or promised or partly paid and partly promised or under any system of deferred payment is a consumer.

Question 2.
Define Consumerism.
Answer:
“Consumerisms not limited to organized efforts only but, is a social movement seeking to augment the rights and powers of buyers in relations to sellers ”
– Philip Kotler.

Question 3.
Give two examples of adulteration.
Answer:

1. Mixing of stones with grains
2. Papayas seed is added to black pepper
3. Coffee Powder is adulterated with tamarind seed.
4. Chili powder is adulterated with brick powder.

Question 4.
What is Caveat Emptor?
Answer:
“Caveat emptor” is a Latin term that means “let the buyer beware” similar to the phrase “sold as is”, this term means that the buyer assumes the risk that a product fails to meet expectations or have defects.

Question 5.
What is Caveat Venditor?
Answer:

1. Caveat emptor was the rule for most purchases and land sales prior to the industrial revolution, although sellers assume much more responsible for the integrity of their goods in the present day.
2. Today most sales in the U.S. fall under the principle of caveat venditor, which means “let the seller beware”, by which goods are covered by an implied warranty of merchantability.

Question 6.
Write a short notes on Consumer Protection Act, 1986.
Answer:

1. The Consumer Protection Act 1986 seeks to protect and promote the interest of consumer.
2. The act provides safeguards to consumers against defective goods, deficient services, unfair trade practices and other forms of their exploitations.
3. The act provides for the setting up of a three tier-machinery consisting of district forums, state commissions and the National Commission.

Question 7.
Which are the three constituent elements of business?
Answer:

1. The producer, the consumer and the Government are the three constituent elements of business.
2. Most of the consumers including academically educated are illiterate about their rights and hence passive.
3. Government should assure an active role in safe guarding the consumers.
4. The consumer is the most exploited constituent in the business world.
5. A consumer is said to be king and the businessmen are primarily supposed to serve and satisfy customers.

Question 8.
What are the important legislations related to consumerism in India?
Answer:
The consumer Protection Act 1986 seeks to protect and promote the interest of consumers. But it has emerged as new forum for the settlement of disputes relating to the sale of goods or services.

1. The agricultural products grading and marketing Act 1937.
2. The Indian Standard Institution (certification marks) Act 1952
3. The Essential Commodities Act 1955.
4. The Drugs and cosmetics Act 1940.
5. The Food Safety Standard Act 2006
6. The Public Liability Insurance Act 1991.

Question 9.
What is meant by artificial scarcity?
Answer:

1. There are certain situations where the shop-keepers put up the board “No-Stock” in front of their shops, even though there is plenty of stock in the store.
2. In such situations consumers who are desperate to buy such goods have to pay hefty price to buy those goods and thus earning more profit unconscientiously.
3. In cinema houses, board may hang in the main entrance “House Full” while cinema tickets will be freely available at a higher price in the black market.

Question 10.
Write the importance of consumerism.
Answer:

1. Awakening and uniting consumers.
2. Discouraging unfair trade practices.
3. Protecting against exploitation.
4. Awakening the Government.
5. Effective implementation of consumer protection laws.
6. Providing complete and latest information.
7. Discouraging anti-social activities.

Question 11.
What is the role of Government in consumer protection?
Answer:

1. Government should assure an active role in safe guarding the consumers.
2. Both the central and state Government have brought out a number of legislations to protect the interest of consumers across the country.
3. The Government also set up separate department of consumer affairs in central and state Government.
4. Despite the existence of legal system to protect the consumers.

Question 12.
How consumers are exploited?
Answer:
Selling at Higher price:
(i) The price charged by the seller for a product service may not be commensurate with the quality but at times it is more than the fair price.
(ii) Consumers are forced to buy the short supply of goods at higher prices in the black market.

Adulteration:
(i) It refers to mixing or substituting undesirable material in food. This cause heavy loss to the consumers.
(ii) This will lead to monitory loss and spoil the health. Eg: Coffee Powder is adulterated with tamarind seed.

Duplicate or spurious goods:
(i) Duplicate products of popular products are illegally produced and sold.
(ii A consumer is not in a position to distinguish duplicate from the original. Eg: Automobile spare parts, watches.

Artificial scarcity:
(i) There are certain situations where the shop-keepers put up the board “No Stock” in front of their shops even though there is plenty of stock in the store.
(ii) In such a situation consumers who are desperate to buy such goods have to pay hefty price to buy those goods. Eg: Cinema Tickets.

Sub-Standard:
(i) On opening a packet or sealed container one may find the content to be of poor quality.
(ii) If defective or damaged items are found in a pack, a consumer finds it difficult to exchange the defective one for good one and consumers have to blame for lack of attention one cannot return it.
(iii) So the consumers have tendency to blame their carelessness or fate for having brought such sub-standard product.

Question 13.
Explain the role of business in consumer protection.
Answer:
Avoidance of price hike:
Business enterprises should desist from hiking the price in the context of acute shortage of goods.

Avoidance of hoarding:
It should not indulge in hoarding and black marketing to earn maximum possible profit in the short term at the cost of consumers.

Guarantees for good quality:
Business enterprises should not give false warranty for the products. It should ensure supply of good quality.

Product information:
Business enterprises should disclose correct, complete and accurate information about the product, quality, quantity, size, side effect, precautions, weight, exchange, mode of application etc..

Truth in advertising:
Business enterprise should not convey false, untrue, bogus information relating to the product through the advertisement in media and thus mislead the consumers.

Protection from the Hazard:
It should test the safety of the product before they are marketed. Business enterprises should not market the product which is potentially hazardous and harmful.

Question 14.
What are the needs for consumer protection?
Answer:

1. Consumer is said to be the king of entire Business sphere his interests are virtually neglected.
2. Shortage of goods makes the consumers to be content with whatever is offered for sale.
3. Quality is sacrificed, warranty of performance has no meaning, health is never considered; profit maximization turns out to be sole consideration of business enterprises. In such a context, consumer protection remains a vital importance.
4. In real practice consumer is not protected or safe guarded but consumer is cheated and looted, so there is a need for consumer movement to safeguard their interest.

Question 15.
Explain the role of consumers in Consumer Protection.
Answer:
Role of consumer in consumer protection:

1. The consumer who alone can put an end to all their unethical trade practices.
2. Business enterprises may break the codes and Government may rest content with mere enaction of laws and do little to protect consumers.
3. In this situation consumers have to be vigilant and organize themselves into a movement for concerted action.

Activation of consumer Action councils:

1. Consumer action councils established at village levels should’ educate consumers of the right.
2. It should regulate business enterprises according to the rules of the industry.
3. It should organize movement against the malpractice of manufacturers and traders.
4. Consumer groups should contact the legislators to raise consumer issues in Assembly and parliament.
5. Voluntary consumer organizations should publicise the malpractices of manufacturers and traders by media.
6. Consumers co-operatives need to be strengthened.
7. Consumer protection agencies should take necessary steps to investigate consumer complaints and grievances, and arrange to forward them to correct forum.

Question 16.
What are the objectives of Consumer Protection Act, 1986?
Answer:

1. Protection of consumers against marketing of goods which are hazardous and dangerous to life and property of consumers.
2. Providing correct and complete information about quality, quantity, purity, price and standard of goods purchased by consumers.
3. Protecting consumers from unfair trade practices of traders,
4. Empowering consumers to seek redressal against exploitation.
5. Educating the consumer of their rights and duties.
6. Putting in place right mechanism like councils and other authorities to enable the consumers to enforce their rights.

Question 17.
Write about five important consumer legislations.
Answer:

1. The Indian Contract Act, 1982 was passed to bind the people on the promise made in the contract.
2. The Essential Commodities Act, 1995 protects the consumers against artificial shortages created by the sellers by hoarding the goods and thus selling the goods at higher prices in black market in respect of essential commodities.
3. The Agricultural Products Grading and Marketing Act 1937 ensures the supply of agricultural commodities at high quality.
4. The Trade Mark Act 1999 prevents the use of fraudulent marks on the product.
5. The Competition Act 2002 protects the consumers against unhealthy competition.
6. The Air (Prevention and Control of pollution) Act 1981 controls and prevents pollution in India.

Question 18.
What are the salient features of the Consumer Protection Act, 1986?
Answer:

1. Protecting consumers against products and services which are harmful to the health of consumers.
2. Protecting consumers from the breach of contract by sellers/ manufacturers.
3. Ensuring consumers with supply of goods at fair quality.
4. Ensuring that consumers are charged fair price.
5. Protecting the consumers against polluting of various kinds.
6. Protecting the consumers against the evil of competition.

Question 19.
What are the objectives of United Nations guidelines for consumer protection?
Answer:

1. To assist countries in achieving or maintaining adequate protection for their population as consumers.
2. To facilitate production and distribution patterns responsive to the needs and desires of consumers.
3. To facilitate the developing of independent consumer groups.
4. To further international co-operation in the field of consumer protection.
5. To encourage the development of market conditions which provide consumers with great choice at lower prices.
6. To assist countries in curbing abusive business practices by all enterprises at the national and international level which adversely affect consumers.

Choose the correct answer:

Question 1.
The term ‘consumerism’ came into existence in the year:’
(a) 1960
(b) 1957
(c) 1954
(d) 1958
Answer:
(a) 1960

Question 2.
Who is the father of Consumer Movement?
(a) Mahatma Gandhi
(b) Mr. Jhon F. Kennedy
(c) Ralph Nader
(d) Jawaharlal Nehru
Answer:
(c) Ralph Nader

Question 3.
Sale of Goods Act was passed in the year:
(a) 1962
(b) 1972
(c) 1982
(d) 1985
Answer:
(c) 1982

Question 4.
The main objective of all business enterprises is:
(a) Providing service
(b) Providing better standard of life
(c) Providing necessities to the society
(d) Earn profit
Answer:
(d) Earn profit

Question 5.
The Consumer Protection ‘Act came into force with effect from:
(a) 1.1.1986
(b) 1.4.1986
(c) 15.4.1987
(d) 15.4.1990
Answer:
(c) 15.4.1987

Question 6.
_________ of every year is declared as a Consumer Protection Day to educate the public abouttheir rights and responsibilities.
(a) August 15
(b) April 15
(c) March 15
(d) September 15
Answer:
(c) March 15

Question 7.
Any person who buys any goods or avails services for personal use, for a consideration is called as:
(a) Customer
(b) Consumer
(c) Buyer
(d) User
Answer:
(b) Consumer

Question 8.
The General Assembly of United Nations passed resolution of consumer protection guidelines on:
(a) 1985
(b) 1958
(c) 1986
(d) 1988
Answer:
(a) 1985

TN Board 12th Commerce Important Questions