Test 1

Question 1

What percentage of the Canadian GDP is taken up by private consumption?

Answer 1

58%

Question 2

Spending is a leisure activity that serves to show my status. What type of consumption is this?

Answer 2

Conspicuous consumption.

Question 3

Why do we need to make choices when spending?

Answer 3

Because our desires are unlimited, but our resources are not. We must choose between spending for desires or spending for necessities.

Question 4

How can we prioritize our needs and desires?

Answer 4

1- Necessary things to satisfy our basic needs such as food, clothing, rent, etc.
2- Important but non-essential things such as a bicycle or bus pass, school, etc.
3- Non-important and non-essential things such as popcorn when going to the movies, music, etc.

Question 5

What are the 5 components (from bottom to top) of Maslow’s hierarchy of needs?

Answer 5

1. Physiological (eating, drinking, sleeping, breathing)
2. Safety (body, job, health, house)
3. Love and belonging (friendship, family, intimacy)
4. Self-esteem, confidence, achievement
5. Self-Actualization

Question 6

What is planned obsolescence?

Answer 6

When to increase profit, a business reduces the life-span of its products. Changing a design (fashion), making things that break, changing the technology.

Question 7

What are the 5 forms of responsible consumption?

Answer 7

1- Local agriculture
2- Organic agriculture
3- Fair trade
4- Purchase with cooperatives
5- Voluntary simplicity

Question 8

What is fair trade?

Answer 8

Fair trade is a guarantee that a product respects the some basic principles. These are creating opportunities for the economically disadvantaged, transparency, fair payment, no child or forced labor, good working conditions, non discrimination, and respect for the environment.

Question 9

What are cooperatives?

Answer 9

Companies that have as goal to help their members and invest in society. Their sole objective is not to make profit.

Question 10

What are 2 alternative methods of budgeting?

Answer 10

1. Pay yourself first (transfer the amount you need)

2. Envelope method.

Question 11

What is net worth?

Answer 11

Assets-Liabilities.

Question 12

What is debt-to-asset ratio?

Answer 12

Total liabilities/total assets.

Question 13

What is the SMART acronym for goals?

Answer 13

Specific, measurable, actionable, realistic, timlely.

Question 14

What are ways to reduce spendings?

Answer 14

• Make lunches at home instead of eating out.
• Make coffee at home.
• Sleep on big purchases instead or buying impulsively.
• Make shopping lists and stick to them.

Question 15

What is disposable income?

Answer 15

Income after taxes and deductions.

Question 16

Do liquid cash and bank account savings fit in the budget or personal balance sheet?

Answer 16

Both! Liquid cash and savings count as “left over from prior months” in the budget.

Question 17

What can be done to prevent goods delivered at home arriving late?

Answer 17

A cancellation clause can be asked, so that if the date is not respected, the order can be cancelled and you can get a refund. The agreed upon date should be written on the back of the bill.

Question 18

Can recovering agencies threaten to sue you or tell you that you’ll go to jail?

Answer 18

No, they hold no legal power. The company or individual who hires the recovering agency can sue you though.

Question 19

Are businesses required to have a refund policy?

Answer 19

No.

Question 20

Is there a minimum deposit for buying goods?

Answer 20

No, you should always negotiate the smallest possible deposit in case the company goes bankrupt.

Question 21

How do cancellation fees on cellphone plans work?

Answer 21

The cancellation fees depend on the rebate given on the cellphone like so: Discount-(Discount x number of months elapsed/total months). If half the contract has elapsed, then the cancellation fee is half of the discount on the phone.

Question 22

How do cancellation fees for internet services work?

Answer 22

The cancellation fee is either 10% of the remaining balance of the contract or 50$, whichever is lower.

Question 23

What are the three types of warranties and what do they do?

Answer 23

1. Basic Warranties: manufacturer’s warranty. Free, (ex. 1 year on most electronics).
2. Extended warranties: cost money but extends the coverage or coverage time.
3. Legal warranty: states that a good should work for its intended use and for a reasonable amount of time. Free.

Question 24

What information are merchants obligated to provide before selling an additional warranty?

Answer 24

Let you know about the legal warranty. Give you a printed document about the legal warranty. Let you know of the manufacturer’s warranty.

Question 25

What are some restrictions for advertisements?

Answer 25

It is forbidden to:

• Advertise a price lower than the real price.
• Advertise a good of which insufficient quantity is available without mentioning so.
• Present data falsely presented as scientific.
• Advertise for kids

Question 26

Appliance repairmen have to give estimations for repairs estimated to cost more than __$

Answer 26

50$.

Question 27

How long are appliance repairs covered under warranty?

Answer 27

3 months.

Question 28

For car repairs, garages have to give a written estimation for repairs exceeding __$

Answer 28

100$. Unless repair is covered by warranty.

Question 29

How long is a car repair covered under warranty?

Answer 29

3 months or 5000km, whichever comes first.

Question 30

How long are motorcycle repairs covered under warranty?

Answer 30

1 month with unlimited km.

Question 31

The price accuracy policy is non-applicable for which products?

Answer 31

Tobacco, alcohol, cow milk and prescription drugs.