Consumer Decisions
1 In what ways are we all like Kirby?
We all want and to see new stuff passing by from stores to stores
2 What is a consumer? Why are all consumers forced to make choices?
A consumer is someone who purchases goods and services to satisfy needs and wants. Everyone has
needs and wants and we spend a lot of time and money trying to satisfy them
3 Explain the difference between a need and a want.
Paste in your notebook pictures of three of your needs and three of your wants.
Need- Food, water and shelter Want- clothes, entertainment and jewelry
4 List the three basic questions you should consider before buying something.
Do I really want this item? Can I Afford it? Is there something better?
5 What are the consequences of making poor commercial decisions?
Buying a item not wanted or needed, making wrong choices and wasting money
6 You receive a gift of $100. You need to make some commercial decisions:
(a) What will you spend the money on? Why? What you really want or been saving up for
(b) Will you save any money? Why? Depends on what I really want
7 Do you believe people can learn how to make wise consumer decisions? Give reasons for your
answer.
Depends on the person, everyone is wise in their own level not with others
8 Think of a product you recently purchased that you now think was an unwise choice. Why do
you consider the choice to be unwise? Outline what influenced you to buy the product.
Buying this game because I do not play it often and it can be a waste of money
1 What is meant by the term ‘budget’?
A list of income and likely expenditures
2 What is the purpose of business?
Organization that produces and sells, for a profit, the goods and services that satisfy the needs and wants
of consumers
3 Identify two ways in which people are dependent on business.
Profit and items
4 Explain how a business makes a profit.
By selling products
5 List the three factors you should consider when deciding on a career.
Your abilities, interests and personality, the careers market — what is available now as well as future prospects, how
to become qualified and prepare yourself for a job.
6 Predict the likely outcome of not having a budget.
Spend everything and debt from credit card and bankrupt and no money
7 What is meant by the expression, ‘Money burns a hole in my pocket.’?
Money can ‘burn’ your pocket = broke, power to spend
Comparison Shopping
1 How is impulse buying different to comparison shopping?
Impulse buying is buying a product without thinking or last min; comparison shopping is taking time to find
the cheapest and most effective price
2 List the sources you can use to undertake a comparison shopping exercise.
Sources such as pen and paper, time and effort
3 Briefly outline the main advantages of comparison shopping.
Getting the cheapest price in the same the product is suppose to do
4 Here are a number of strategies you can use to help avoid impulse buying. Copy each of them
into your notebook and then explain how the strategy would help avoid falling into the trap of
impulse buying.
(a) Prepare a shopping list. Knowing what to buy
(b) Compare different brands. Finding better brand
(c) Compare prices at different stores. Cheapest store
(d) Ask yourself, ‘Do I really need this?’ If you really need it
FACTORS AFFECTING CONSUMER DECISIONS
Companies and groups
Is it the suitable price?
Is it worth it ?
What they like for that age?
Suitable for the environment?
Males or females more?
Do they want that product
Consumer Protection
1. Name two important pieces of legislation that protect consumers
Fair Trading Act
Fair Legislation Act
2. Unscramble the following words and then use each one in a sentence to explain its meaning
(a) rfai og fair go
(b) arif giatdrn tca Fair Trading Act
(c) anunooclecbisn cdnoctu Unconscionable Conduct
(d) tbai nda htwsci Bait and Switch- expensive products
(e) dlienasmgi vtseagndrii Misleading Advertising
3. Write a brief report about a scam or rip-off in which either you or a member of your family
has been involved.
A large amount of money was taken from a family member’s credit card to a company in
America that we had never heard of selling a product I had never heard of.
5. What does the law say to do if you are sent some goods which you did not order?
You can write to the trader and tell them where they can pick it up
7 Outline some reasons why consumers may need protection.
So consumers are not ripped off and taken advantage of while shopping
8. Ethical;
Responsibility
Honesty
Integrity
Reputation
Unethical;
AggresionGreed
Dishonesty
Deception
Harassment
Comsumer Redress
5 Imagine you buy a laptop computer and find it is damaged. The store owner believes you
dropped it and should pay for repairs. Construct a flow diagram showing the steps you can take
to make a consumer complaint. Briefly outline what occurs at each step. Alternatively, prepare
this as a PowerPoint presentation.
Contact the local Office of Fair Trading and seek advice > explain your situation in a formal manner >
must lodge a formal written complaint > provide office with what they want (receipts, etc) > the office
will contact the trader and attempt to reach a solution
Keeping Record
1 Unscramble the following words and then use each one in a sentence to explain its meaning.
(a) eeessprhdat speardsheet
2 What is an active cell on a spreadsheet?
The selected cell
3 What is the main advantage of using a database to record and monitor financial transactions?
4 Construct a simple database showing a record of ten different cash, credit card, debit card and
cheque purchases. Give the database an appropriate title. The database should contain fields for
date, name of the store or company, good purchased, amount, method of payment and comments.
Impact of technology
1.Describe, using two examples, how technology has affected the way in which consumers can pay for their
goods and services.
You can pay via your credit card or you pay via the telephone
2. Conduct a bartering session in your class. Each class member can bring along something to barter, such as
pieces of food. Display the goods on the desks.
3.After the session, complete these sentences:
(a) Double coincidence of wants occurs when 2 people want what the other has to offer
(b) Agreeing on the value of something is when both party’s being happy
(c) Some people were disappointed with their barter
because items can be difficult to value
(d) Money makes trading easier because .you get greater freedom while buying goods or services
4. How are banks encouraging customers to use EFTPOS rather than over-the-counter transactions?
They are charging extra fees for over the counter transactions once the agreed number is exceeded which are
higher than those of an eftpos transaction
5. Banking and paying bills via the internet is very convenient. However, what problems might arise for
customer privacy and security?
You have a key logger on your computer and you passwords may be sent to an unknown user who can access your
details and send money into their account
6. How might older people and the poor be disadvantaged if over-the-counter transactions attract higher bank
fees than internet banking?
Older people may not be able to use the internet or may not prefer it so they will be forced to pay money that they
may not have
Investigate
7. Using your library and the internet, research an early form of money. Find out where and when it existed,
who used it and what it was like.
Aboriginals used seeds and various rocks for its form of money in the 1900s
Product promotion legal ethical issues
1 What does the Trade Practices Act make illegal?
False misleading advertisement
2 Explain how the following promotion strategies may mislead consumers.
(a) Fine print - Important conditions are written in a small-sized font and are, therefore, difficult to read.
(b) ‘Before’ and ‘after’ advertisements- Consumers may be misled when ‘before’ images are worsened
and ‘after’ images are enhanced
3 What is meant by the term ‘materialism’?
Individual’s desire to constantly acquire possessions
4 Why are businesses keen to use product placement?
Increase of advertisement for people to buy when passing by
5 In each of the following examples, state whether there has been a breach of the Trade Practices
Act.
(a) A company advertises jumpers and claims that they are made in Australia when, in fact, they
are made in Hong Kong. BREACH
(b) A company advertises that the special deal is for one week only, when, in fact, it plans to
extend it indefinitely. BREACH
7 Do you consider product placement an ethical or unethical promotion strategy? Give reasons
for your answer
I reckon is ethical because its how business runs, they promote, advertise and sell as much as they can
get
Applying selling techniques
1 What is the message The Coca-Cola Company has adopted in its advertisements?
That every bit of it is happiness
2 How has Coca-Cola’s target market changed over time?
Improved taste, no drugs and bottle/can design
3 The successful formula for ‘Coke’ is not the ingredients of the drink but its superior selling
techniques.’ Do you agree or disagree with this statement? Give reasons for your answer.
Agree, everyone is addicted to coke for its taste regardless of its ingredients
5What are the advantages to The Coca-Cola Company in diversifying and selling water and fruit
juice products?
Improve and expand the selling branch for people who don’t enjoy coke, may have different taste
6 Select three selling techniques used by The Coca-Cola
Company and explain how each one helps the company increase its sales.
Advertisement with teens male and female- attraction
Colourful and happiness- Express what coke is
Slogan – Open the drink to wear the happiness
Monitoring and evaluation selling techniques
1 What data did Omni Electronics need to collect to monitor and evaluate the new selling
techniques?
Tally of solds , group range and income rate of the customers
2 How can a business evaluate the effect of its selling techniques on its customers?
To see what group buys it and what can be improve for other groups to buy
3 Why is it important to survey customers?
To improve the business rate of the store
4 Explain how monitoring and evaluating are linked.
To see and write down the conclusion of the new selling technique
5 Look at the Omni Electronics sales data at left and then complete the tasks.
(a) Which sales territory had the:
(i) highest actual sales? Number 2
(ii) lowest actual sales? Number 5
(b) What does the ‘Difference’ column measure? What is the importance of this column?
Difference between forecast sales and actual sales
(c) Which sales territory had the:
(i) largest percentage change? Number 1
(ii) smallest percentage change? Number 3
(d) What is the importance of having a ‘% change’ column?
To see the changes through time by time and future, made for changes
6 A business has a sales potential of $90 000 but achieves actual sales of only $25 000. What does
this signify? What should the business do next?
More sales to improve the income rates for a period of time, this signify that the business customers are
not buying as before because you don’t buy a TV every month