Business and Economics Flashcards
What is the definition of consumer decision making?
Consumer decision making is the process by which individuals identify their needs, gather information, evaluate alternatives, and make purchasing decisions.
True or False: Financial decision making only involves choosing between different investment options.
False
Fill in the blank: Superannuation is a form of __________ designed to help individuals save for retirement.
pension
What are the three main stages of the consumer decision-making process?
Problem recognition, information search, and evaluation of alternatives.
Multiple Choice: Which of the following is NOT a factor influencing consumer decision making? A) Cultural influences B) Personal preferences C) Government regulations D) Investment strategies
D) Investment strategies
What is the primary purpose of superannuation?
To provide individuals with funds to support their retirement.
True or False: Risk tolerance is an important factor in financial decision making.
True
What is the difference between stocks and bonds?
Stocks represent ownership in a company, while bonds are a form of debt investment where the investor lends money to an entity.
Fill in the blank: The __________ rate is the return on an investment expressed as a percentage of the initial investment.
interest
Multiple Choice: Which investment option is generally considered the least risky? A) Stocks B) Real estate C) Bonds D) Commodities
C) Bonds
What is meant by the term ‘diversification’ in investment?
Diversification is the practice of spreading investments across various assets to reduce risk.
True or False: All superannuation funds are managed in the same way.
False
What does the term ‘liquidity’ refer to in financial decision making?
Liquidity refers to how easily an asset can be converted into cash without significantly affecting its value.
Fill in the blank: A __________ is a financial product that provides a return based on the performance of an underlying asset.
derivative
What is the importance of setting financial goals?
Setting financial goals helps individuals create a roadmap for their financial future and make informed decisions.
