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Created by ameliajaneee
over 10 years ago
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Question | Answer |
Need | things that are necessary for survival, e.g. water and food |
Wants | things that are not essential for survival, but we would like to have |
What is Commerce? | Commerce examines how people earn their income, how they spend their money and what goods/services are produced |
private want? Collective want? | Private: wants we desire individually Collective: wants provided by government (roads, hospitals) |
complementary wants? substitute wants? | C: wants used together e.g. car and petrol S: can be used to replace something else, e.g. glue and sticky tape |
Key factors affecting consumer decisions | Service Price Convenience Marketing/advertising gender, age, finance, environmental |
3 basic questions before buying a product? | 1. do i really want this item? 2. Can i afford it? 3. Is there something better? |
Retailers | Sell directly to public |
department stores | one type of retailer, usually large stores that sell a variety of goods, e.g. Myer and David Jones |
Speciality stores | focus on selling a particular type of good (JBHIFI) |
supermarkets | specialise in selling groceries and household goods (Coles, Aldi) |
convenience/general stores | smaller stores that are open longer hours, and often attached to a petrol station e.g. seven eleven |
Advantages of internet purchasing | Comparison shopping, cheaper products, quick delivery times, Credit card use, purchase for overseas |
Disadvantages of internet purchasing | delivery charges, untrustworthy traders, risk of scams, return of faulty product/s takes time and effort |
advantages of mail order | range of products often not in retail stores, convenience for consumers who are handicap or live in remote areas |
Disadvantages of mail order | Product being different in reality, losing money if product is not delivered, |
Merchantable quality | The product is fit for purpose, acceptable in appearance, free from defects, safe and durable |
What is a contract? | legally enforceable agreement between two or more persons/parties |
3 elements of a contract | Offer: one of the parties offering something in value Acceptance: offeree agrees to proposal Consideration: required to form a valid contract |
Bait and switch? | Scam involving advertising a few products at reduced items to attract costumers. When the advertised products quickly sell out, costumers are directed to higher priced items |
Unsoliated goods | This involves sending unordered goods through the mail and then demanding payment |
Misleading advertising | Using words that are deceptive or claim that a product has some specific quality, when it does not. These actions convey a false impression. |
Pyramid scam | Chain letter is a common form. You are required to pay a joining fee with the opportunity to earn quick money as you recruit new members. However, most people just lose their money. |
4 legal rights for consumers | 1. Safe products: directions for use provided, tested by manufacturer 2. Accurate product information and descriptions 3. Full disclosure of the terms of sale 4. Consumer guarantees and warranties are honoured: expect a refund or exchange if faulty |
Accc? | Australia competition and consumers commission is obligated to inform the public so that they are aware of their rights under the law. |
ASIC? | Australian securities and investments commission protects consumers in areas of credit, investment, life insurance, superannuation and banking |
Ombudsman | Swedish word meaning 'agent'. Someone who has the task of investigating and reporting on complaints |
Department of fair trading NSW | Provides information and assistance to consumers on areas such as issues, shopping online, home building and motor vehicle sales |
Advantages + disadvantages of cash | A: readily accepted by shops, allows shopping to be quick D: large amounts carried can be stolen, Bank and ATM'S not always available |
Advantages + disadvantages of credit | A: Buying now and paying later, provided by a financial institution (bank) D: interest charges, encourage impulsive buying, have to be credit worthy |
Advantages + disadvantages of cheques | A: easy to carry, direct and good for large amounts of money D: banks may charge a fee to operate cheque, can be forged |
Advantages + disadvantages of direct debit | A: good for charity organisations and regular payments (won't be forgotten) D: not always trustworthy, can add up to be too expensive |
Advantages + disadvantages of EFTPOS | A: convenient system, removes problems that occur when using cash D: experience problems if server crashes, magnetic strip on plastic card can be damaged |
Cheque: drawee, payee and frawer | Drawee: financial institution that provides cheque account facilities Payee: person receiving money from cheque Drawer: Person who signs and authorises the transaction |
Impulse buying | buying something without giving much thought as to whether you really need it |
Cash flow | money coming into and going out of a business |
interest | extra money you have to pay when borrowing money |
scam | an illegal business practice |
rip-off | to overcharge or swindle |
caveat emptor | a term meaning 'let the buyer beware' |
comparison shopping | contracting a number of sellers to obtain the best deal |
Business | an organisation that produces and sells goods/services in order to make a profit |
Fair go | being treated justly and honestly |
5 decisions that people make in their lives (Apart from consumer decisions) | 1. Financial decisions 2. Business decisions 3. Employment decisions 4. Legal decisions 5. Environmental decisions |
Why is advertising important to consumers? | Advertising plays a major rule in influencing consumer decisions. If the marketing campaign is successful, consumers will THINK that they need the particular product |
Purpose of a budget | The purpose is to not spend more than you earn. A budget balances income and expenses. |
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