Journal Entry Clara is thinking of about buying a new camera. She found a discontinued model she likes offered at half price. The store has only one left. If she wants to buy the camera she must do it immediately. What decision should Clara make, and why?

A Rational buying Decision  Is a choice made in an organized, logical manner.

Impulse Purchase  Is a purchase made on a whim without using a decision making process.

The decision making processes  Specify  Search  Sift  Select  Study

Specify  Identify the need or want that you are trying to fulfill. Determine your goals.  Example- You need a new pair of sandals, but they have to be less than $20 dollars.

Search  Plan specific steps to gather information.  Ex. Look up all of the discount shoe store in your area. Make a plan of which ones you would like to check out.

Sift  Look at all of your options. Look at your opportunity costs.  Ex. Go to all the shoe stores in your price range and compare the quality and cost of the sandals.

Select  Make a choice and act on it.  Ex. Compare the pros and cons of each shoe you liked and go with your best option.

Study  Evaluate the result.  Do you love the sandals still after a month or are they falling apart? Learning is an ongoing process.

Buyer’s Remorse  To regret a buying decision.  Usually follows an impulse purchase.

Economic System  Is the way a nation uses resources to produce goods and services.

Production  Is the creation of goods and services.  Manufacturing products- cars, pencils.  Providing services- dry cleaning

Resources  Includes:  Land- construction sites, offices, crops, forests.  Labor- physical and mental effort from the workforce.  Capital-tools that workers use to make products. (buildings and machinery)  What would a car manufacturer need to make a car?