Consumer and Financial Decisions Flashcards
(35 cards)
What is a Consumer decisions?
A consumer is someone who purchases goods and services to satisfy needs and wants
what is the basic economic problem?
Our wants are unlimited:
Resources are scarce → resources we have to satisfy our wants are limited. The economic problem is essentially about trying to allocate our limited resources for the satisfaction of our unlimited and competing wants.
what are the factors influencing consumer and financial decisions
Advertising
Age
Convenience
Culture
Customer service
Disposable income
Environmental consideration
Social media
what is comparison shopping?
often the same product costs different amounts at different stores or sites. Shopping around to obtain the best deal
What is a generic product?
are products that are named only by their basic product type, and not an individual brand.
what is LOCALLY shopping
The local convenience store or shopping region (takeaway, newsagent and grocer) will frequently be used by consumers who live nearby. The local community will often shop here because of the convenient location. However, their purchases are restricted to only a few basic items.
what is REGIONALLY shopping
Department stores, discount department stores and supermarkets are often located in large regional shopping complexes, such as Westfield centres, and are surrounded by numerous specialty stores. The stores are in one convenient location and there is ample parking provided. Usually includes cinemas and food halls. Customers often travel from surrounding suburbs.
what is INTERSTATE & GLOBALLY shopping
Nowadays consumers can purchase goods from another state or country. We live in a global world → consumers are no longer restricted to their local or regional shopping centres. Consequently, consumers in search of a specific item, cheaper prices or greater variety will often decide to purchase from a global marketplace.
what are the different payment options
cash, credit, paypal, store credit, DEBIT CARD AND BPAY, cheques
what is a cheques
A cheque is a written communication ordering your financial institution, called the drawee, to pay a person a specific amount of money → the payee. The person authorising the transaction is termed the drawer.
what is debit card and bpay
With a debit card, you are using your own money, by electronically accessing money already in your account. You pay no interest and can spend up to your account balance.
BPAY® is another type of electronic payment method → uses the telephone or internet to transfer funds from your cheque, savings or credit card account to the account of the business you wish to pay.
what is store credit
Some large stores or retail groups issue their own cards that operate like regular credit cards. These cards usually are associated with special deals, discounts, bonuses and a rewards program. However, these cards usually have higher interest rates and fewer interest-free days than regular credit cards.
what is paypal
Most online merchants accept PayPal as one of their methods of payments. PayPal is an intermediary where you end up paying for the good using your credit card, bank account or money stored in your PayPal account. An advantage of using Paypal is the security → can receive a refund if there is a problem with the transaction.
what is credit
Credit is the supply of money now in return for the promise of paying it back later. Credit allows you to buy what you want immediately and pay for it later → upfront or monthly payments.
what is cash
Cash are the notes and coins (money) issued by the federal government.
what is lay-by
Lay-by’s require the customer to pay a deposit and then the store puts aside the good for you.
what is after-pay
Afterpay is a digital service linked to a customer’s credit or debit card and enables consumers to ‘buy now, pay later’ → purchase something at the current price and pay it off in four equal instalments every two weeks.
what is fixed expenses
Fixed expenses are those expenses that you do not have much control over. These expenses remain the same over a period of time. Examples include your bus or train fare, rent and Gym membership.
what is variable expenses
Variable expenses are those expenses that you have some control over. They are expenses that change over time. Examples include purchasing clothes or food.
what is savings
Savings is the part of income that is not spent. It is put aside to build up for a range of different reasons.
eg. Purchase expensive items in the future such as a home, car or boat.
Save for a holiday
Have funds available in the case of an emergency
Earn interest on their invested money
Have money to live on when you retire and stop working.
what is budgeting
A budget is an organised way of managing finances → gives an overall picture of where your money is coming from, when it’s coming in and when it’s being spent.
why is budgeting important of teenages
To save for large purchases in the future or even short term goals
Teaches independence and responsibility
Teaches basic budgeting skills involving math, organisational and logic skills
Many jobs pay teens well and it is essential to teach budgeting early so to avoid careless spending.
what is the law that protects consumers
Competition and Consumer Act 2010 (Cwlth)
Fair Trading Act 1987 (NSW)
what is unconscionable act
Under the Competition and Consumer Act, an unconscionable act by a seller is any practice that is just not reasonable, such as scams and rip-offs.
