You, The Consumer How do I contribute to the economy?

Consumer –any person or group that buys or uses goods and services to satisfy personal needs and wants. 12/25/2015Template copyright Important Terms You Need to Know

12/25/2015Template copyright Marketing –All the activities needed to move goods and services from the producer to the consumer. Utility –The ability of any good or service to satisfy consumer wants. Important Terms You Need to Know

the types of utility –Form utility The conversion of raw materials into goods and services –Place utility Having a good or service available where consumers want them Important Terms You Need to Know

the types of utility –Time utility Having a good or service available when consumers want them. –Ownership utility The satisfaction that comes from owning a good or service. Important Terms You Need to Know

12/25/2015Template copyright Important Terms You Need to Know Disposable income –money remaining after taxes have been paid. Discretionary income –money remaining after bills have been paid.

Important Terms You Need to Know Rational self-interest –Individuals try to maximize the expected benefit achieved with a given cost or to minimize the expected cost of achieving a given benefit. 12/25/2015Template copyright

12/25/2015Template copyright Consumer Spending 32%Housing and household operation 14%Food 5%Clothing 19%Transportation 5%Healthcare 5%Entertainment 9%Life Insurance, Social Security, and Retirement plans 11%Other

12/25/2015Template copyright Basic Buying Principles Gathering Information Using advertising wisely Comparison shopping

12/25/2015Template copyright Consumer Rights The right to safety The right to be informed The right to choose The right to be heard The right to redress

12/25/2015Template copyright Types of advertising Competitive advertising –Advertising that attempts to persuade consumers that a product is different from and superior to any other.

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12/25/2015Template copyright Types of advertising Informative advertising –Advertising that gives information about a product.

12/25/2015Template copyright Billy Mays Vince

12/25/2015Template copyright Types of advertising Bait and Switch (deceptive advertising) –An ad that attracts consumers with a low- priced product, then tries to sell them a higher-priced product.

12/25/2015Template copyright A few more terms Comparison shopping –getting information on the types and prices of products available from different stores and companies. Warranty –promise made by a manufacturer or a seller to repair or replace a product within a certain time period if it is found to be faulty.

12/25/2015Template copyright Food and Drug Administration (FDA) –Government agency that protects the public against impure and unsafe foods, drugs, and cosmetics.

12/25/2015Template copyright Brand name –word, picture, or logo on a product that helps consumers distinguish it from similar products. Generic brand –general name for a product. A few more terms

12/25/2015Template copyright Rules for the Supermarket Work the edges –The healthiest foods are found along the walls. Dairy, meats, produce, and seafood are found there. Look high and low –Supermarkets charge “slotting fees” for the prime real estate on the shelves. That is why the Kellogg’s, Krafts, and Proctor & Gambles have products at eye level. The healthy foods are usually located on the top or bottom shelf.

Long lines means you buy more –You are 25% more likely to buy the sodas and candy around you if you have to wait in a long check out line. 12/25/2015Template copyright Rules for the Supermarket

12/25/2015Template copyright FDA Regulations Canned pineapples can contain up to 20% moldy fruit. Canned tomatoes can contain up to 5 fly eggs or 2 maggots per 500 grams. Frozen broccoli can contain up to 60 mites per 100 grams. Ground cinnamon can contain up to 400 insect fragments and 11 rodent hairs per 50 grams. Peanut butter can contain up to 30 insect fragments or 1 rodent hair per 100 grams. Popcorn can contain up to 1 rodent pellet in one sample or 2 rodent hairs per pound. Potato chips can contain up to 6% rotten potatoes.