1. Your Role as a Consumer

2. Consumption, Income, and Decision Making

3.  Consumer : any person or group that buys or uses goods and services to satisfy personal needs and wants  A person’s role as a consumer depends on their available income and how much of it is spent or saved.  Disposable income : income remaining for a person to spend or save after all taxes have been paid.

4.  Discretionary income : money income a person has left to spend on extras after necessities have been bought  Spending income requires constant decision making.

5.  Making consumer decisions involves three parts.  Time costs  Invest time in obtaining information about the item  Opportunity costs  Choosing between a low, medium, or high-quality item  Rational choice  Making a decision based on opportunity cost.

6.  Choose the best quality item that is the least expensive and will satisfy your wants.  Rational consumers all make different choices.

7. Buying Principles or Strategies

8.  Takes time and research.  Try to find out only what you need to know.  Getting accurate information from a salesperson is a life-long skill.  Use the internet to research a product and the companies selling it.

9.  Advertising is everywhere.  Three common types of advertising:  Competitive Advertising = advertising that attempts to persuade consumers that a product is different from and superior to any other  Informative Advertising= advertising that benefits consumers by giving information about a product  Bait and Switch = advertising that attracts consumers with a low-priced product, then tries to sell them a higher-priced product

10.  Comparison shopping : getting information on the types and prices of products available form different stores and companies  Use information obtained from other stores to negotiate a lower price.  Consider the different product warranties.  Compare the value of generic to brand name products.

11. Consumerism

12.  Consumerism : movement to educate buyers about the purchases they make and to demand better and safer products from manufacturers  Business are now responsible for product safety, healthful food, and accurate advertising.

13.  Since 1962, consumer have the right to product safety, to be informed about their product, to choose from a variety or products, and the be considered in making laws about products.

14.  People can complain to store managers and manufactures when dissatisfied with a product.  Better Business Bureaus give information on products and help to settle buyer and seller disagreements.

15.  There are magazines and private consumer groups that provide helpful information on products.  Federal agencies require consumer notification and warranties.

16.  Be informed about purchases.  Consumers need to initiate the problem- solving process when a product or service is faulty.  Practice honest and ethical behavior.

17.  Only return products with legitimate faults.  Ethical behavior : acting in accordance with moral and ethical convictions about right and wrong