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Commerce > Consumer and financial desicsions > Flashcards

Consumer and financial desicsions Flashcards

1
Q

What is commerce

A

Recognising that consumers have needs and wants. Businesses create the product to satysfy these wants and needs

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2
Q

3 questions to ask before buying an item

A

Do i need it?
Can i afford it?
Is there something better (comparison shopping)

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3
Q

What do advertisements do to entice a consumer?

A
  • celebrity endorcements
  • Lists info
    -Music/jingles/slogans
    -short duration
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4
Q

What is subsitence?

A

To focus on basic needs and not more

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5
Q

Factors affecting a persons spending?

A

-Age
-Trends
- Disposable income
- convenience
-Culture
-Financial background

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6
Q

What are cultural factors?

A

The set of basic values, perception, wants and behaviours of a particular community or group of individuals

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7
Q

What is disposable income?

A

The amount of money that households have available for saving and spending after income taxes have been accounted for

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8
Q

Different sort of expenses

A

Fixed and Variable

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9
Q

What is a fixed expense

A

expenses that you do not have much control ovre e.g rent or transport fees

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10
Q

What is a variable expense?

A

Expensed that you have control over or can change e.g food

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11
Q

What is saving and why do people save?

A

Saving is income that isnt spent but put aside for different reasons like:
Earn interest
Save for holiday
Having money for retirement

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12
Q

What is a savings plan?

A

A commitment to regularly putting aside money for future use

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13
Q

What is deficit and Surplus

A

Deficit - spending more than income
Surplus - spending less than income

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14
Q

Why are budgets important?

A

Given that inflation is rising meaning general prices are increasing it is essential for Australians to create, monitor and adjust their spending

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15
Q

What is comparison shopping? WHy is it important?

A

Comparison shopping is looking at different stores to compare quality, price and availability. It allows you to compare and spend on the best quality and affordable goods and services

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16
Q

What are manufacturers

A

The place where a produt is mad

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17
Q

What are wholsalars?

A

Are businsess that specialise buying products form manufacturerers and increase prices to sell to retailers

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18
Q

What are retailers?

A

They buy off wholesalers and increase the price to sell to consumers

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19
Q

Disadvantages of online shopping

A

Delivery charge
return policy
scams

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20
Q

Advantages of online shopping

A

Easier to comparison shop
And have access to stores globally
Possibly cheaper products

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21
Q

What are the two consumer protection laws?

A

Competition and consumer act 2010 (cwlth)
The fair trading act 1987 (NSW)

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22
Q

False and misleading advertising

A

Bait and switch- they attract costumers to a certain product than say they have ran out and offer a more expensive item
Misleading - Claim a product has certain qualities but it doesn’t

23
Q

Referral selling

A

When a shop asks a person to refer a certain amount of people to an item in return for a special deal. But then retracts offer after the referral

24
Q

Get rich quick schemes

A

A letter or emails offering you a chance to transfer money to a certain place in return for a percentage of that money meanign you have to give bank details

25
Q

What is a contract?

A

Legally enforceable agreement between two or more people or parties which outlines details, agreements and rights. either oral or written.

26
Q

Examples of contracts

A

Academic honesty
employment
House/car purchases
Subscription
(anything to do with a terms and conditions)

27
Q

Features of a contract?

A

Offer - clearly communicate what they are offering
Acceptance - when the parties agree to proposal
Consideration - both parties agree to give up something of value
(both have to be competent)

28
Q

Advantages and disadvantages of cash

A

Widley accepted - lost or stolen
discount for cash - No ATM = no buy
no hidden costs

29
Q

what is a Credit card

A

The supply of money from the bank then in return paying that money back regularly

30
Q

Advantages and disadvantages of credit card

A

Avoid carryign cash - easier to overspend/debt
Convenient for online buys - damadge to credit rating

31
Q

What is paypal?

A

The intermediatry between money in bank account and the business account (more security)

32
Q

What is Store credit?

A

Store credit are associated with the deals, discounts, bonuses and rewards. (higher interest rate)

33
Q

What is EFT?

A

Electronic Funds Transfer e.g BPAY and Lay-by

34
Q

What is direct Debit

A

Scheduled payments from a nominated bank account. This bank automatically withdraws these funds from the account.
However enough money has to be in the account
Sometimes bills may be incorrect

35
Q

What is Lay-by

A

when a consumer pays a deposit and the store puts aside the good
you then make regular payments of a certain period of time. you don’t possess the good unless you have fully paid for it.
If the lay-by is cancelled they refund the product after deducting storage, handling and deprecation costs

36
Q

what are the four basic rights that consumers have

A

Consumers guarantees and warrants are honoured
Safe products
Accurate product and description
Full disclosure of terms of sale

37
Q

Illegal selling strategeies used by businesses

A

Fine print
Misleading before and after shots
Incorrect survey or data
country of origin
packaging size

38
Q

What are consumers guaranteed to when they buy a product

A

adequate quality
complies with warranty
spare parts if available
match description, demo model or sample

39
Q

What are consumers responsibilities when buying a product

A

paying the correct amount, purchasing goods and services from ethical and legal sources, using the products in an environmentally friendly manner and accepting most of the risk when they purchase something.

40
Q

What are consumers guaranteed to when they buy a service

A

fit for purpose
provided with reasonable care and skill

41
Q

What is disposable income?

A

The amount of money available for spending and saving once income taxes have been accounted for

42
Q

What are budgets?

A

An organised way of managing finances
you know where money is coming in and going out

43
Q

WHy should teenagers budget

A

Save for large purchases
teaches independence and responsibility
avoid careless spending in the future

44
Q

What are convenience stores?

A

They sell products concentrating on food, magazine and newspaper, Their prices are usually higher and limited choice e.g 7/11

45
Q

Specialty stores

A

They specialise in one type of product, service or a limited range of a few products. The sale staff have a sound knowledge of the product. E.g hairdressers gift shop

46
Q

Discount variety store

A

normally cheaper than department stores and offer a large variety of product meaning that they attract a large amounts of consumers e.g Kmart target

47
Q

Factory outlets

A

Products in a factory outlet come straight from manufacturers and are sold at a cheaper price becuase transportation and wholesalers are not involved e.g nike factory stores

48
Q

Department stores

A

Large range of products in one store. becuase they buy in bulk products are generally cheaper. however they are more expensive than discount variety stores becuase they offer sales assistance

49
Q

Supermarkets

A

Generally sell food and are self serving however they are beginning to offer large variety products

50
Q

What is superannuation?

A

A government scheme that requires all employers to pay an additional 10.5% of an employees salary into a fund that can be accessed at 67

51
Q

3 social issues as a result of poor financial management?

A

Relationship fall outs
social isolations
inability to holiday and travel with family and friends

52
Q

3 personal issues as a result of poor financial management?

A

mental and emotional illness
unable to satisfy ones needs
Excessive debt - negative credit scores

53
Q

3 legal issues as a result of poor financial management?

A

Bankruptcy
write of exaction - court officials can seize and sell their property
garnishee- take a certain amount of money from your wages to pay back debt

54
Q

Strategies to recover from poor financial decisions?

A

rolling debts into one loan
personal budget
emergency funds

Commerce (4 decks)

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