Assignment: #1 Consumer Rights & Responsibilities
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CHAPTER01.pptECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
WHAT’S AHEAD
1.1 Decisions, Decisions
1.2 Make Decisions
1.3 Understand Economic Systems
1.4 Consumer’s Role in the Economy
1.5 Advertising and Consumer Decisions
1.6 Be a Responsible Consumer
Economic Education for Consumers
Economic Education for Consumers
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Chapter 1
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Chapter 1
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
LESSON 1.1
Decisions, Decisions
GOALS
Identify several important values you hold.
Explain how creating a life-span plan helps you make better decisions.
Describe what an opportunity cost is.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
KEY TERMS
values
goals
needs
wants
long-term goals
life-span
life span goals
life-span plan
short-term goals
opportunity cost
© 2010 South-Western, Cengage Learning
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
You’ve Got the Power
Values
Values change
Different people, different values
© 2010 South-Western, Cengage Learning
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Goals
Needs and wants
Hopes and dreams
A life-span plan
Short-term goals
Work to reach your goals
© 2010 South-Western, Cengage Learning
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Opportunity Cost
Opportunity cost and decisions
Consider other options
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
What are the various ways values can be classified?
How can creating a life-span plan help you make better decisions?
What is opportunity cost? Give an example.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
What are the various ways values can be classified?
Values are the principles, or standards, by which you live.
Life values
Work values
Cultural values
Social values
Demographic values
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
How can creating a life-span plan help you make better decisions?
A life-span plan is a strategy you create to help you achieve your long-term goals.
You can use this plan to help you make decisions and identify the actions to take as you work toward your goals.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
What is opportunity cost? Give an example.
Opportunity cost is the value of your next best alternative whenever you make a choice.
Examples:
go to college or get a job right now
save for a new car or take a vacation
go out for a nice dinner or do pizza and a movie tonight
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
LESSON 1.2
Make Decisions
GOAL
Describe each of the five steps in the decision making process.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
KEY TERM
rational buying decision
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Decision Making Process
Specify
Search
Sift
Select
Study
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Specify
Need or want?
Goals
Values
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Search
Plan your search
Avoid impulse purchases
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Sift
Look at your options
Look at your opportunity costs
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Select
Compare the benefits and costs
Decide
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Study
You can learn important lessons from the results of your actions
Would you do the same thing again? If so, why?
If not, what would you do differently?
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Describe each of the five steps in the decision making process.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Describe each of the five steps in the decision making process.
Specify: Identify specific need or want; determine your goals
Search: Gather information about your alternative choices
Sift: Evaluate your options; consider your opportunity costs
Select: Make a choice and act on it
Study: Evaluate the results of your choice
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
LESSON 1.3
Understand Economic Systems
GOALS
Describe four economic systems.
Explain how demand and supply work.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
KEY TERMS
production
resources
economics
profit
scarcity
demand
supply
equilibrium price
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Economic Systems
Traditional economy
Command economy
Market economy
Mixed economy
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Demand and Supply
Demand
Supply
Equilibrium
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Quantity
y
Price
Demand curve
x
© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
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Quantity
y
Price
Supply curve
x
© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
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100
Quantity
y
$1
Price
Demand curve
Supply curve
x
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50 100 150
Quantity
y
$1
Price
Demand curve
Supply curve
$2
Surplus
x
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75 100 125
Quantity
y
$1
Price
Demand curve
Supply curve
$0.50
Shortage
x
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
What are the primary characteristics of each of the four economic systems?
How do demand and supply work together to determine prices and how much producers will produce?
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
What are the primary characteristics of each of the four economic systems?
Traditional economy: the ways to produce products are passed from one generation to the next
Command economy: the government owns most resources and makes most economic decisions
Market economy: people, rather than the government, own the resources and run the businesses
Mixed economy: a mixture of a market economy with some aspects of a command economy, for example
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
How do demand and supply work together to determine prices and how much producers will produce?
Producers are willing to offer more of a product for sale at a higher price than at a lower price
© 2010 South-Western, Cengage Learning
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Quantity
Price
Supply curve
- As the price rises, the quantity supplied increases (and price decreases)
- As price decreases, the quantity supplied decreases (and price increases)
© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
LESSON 1.4
Consumer’s Role in the Economy
GOAL
Explain the role of consumers in determining what is produced in a market economy.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
KEY TERMS
consumer
consumer economics
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Making Decisions
in a Market Economy
Information for the economy
Prices
The profit motive
Consumer economics
Consumers in charge
Benefits of competition
Efficiency and profits
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
How do demand and supply act together in a market economy to set the equilibrium price for a product?
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
How do demand and supply act together in a market economy to set the equilibrium price for a product?
Profits result from selling products for more than it costs to make them
To earn a profit, businesses must produce products that consumers buy
When consumers spend their money, they determine what products are produced
At the equilibrium price, consumers are willing and able to buy the same amount of the product as producers are willing and able to supply
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
LESSON 1.5
Advertising and Consumer Decisions
GOALS
Describe different types of advertising.
Explain how you can recognize deceptive advertising.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
KEY TERMS
advertising
puffery
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Types of Advertising
Brand advertising
Informative advertising
Comparative advertising
Defensive advertising
Persuasive advertising
Benefits and costs of advertising
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Deceptive Ads versus Puffery
Puffery
Factually wrong
Exaggerated claims are legal
Is it free?
Protecting yourself from deceptive advertising
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Identify and describe characteristics of each of the types of advertising presented in this lesson.
How can you recognize and protect yourself from deceptive advertising?
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Identify and describe characteristics of each of the types of advertising presented in this lesson.
Brand advertising: helps consumers to recognize brand name
Informative advertising: influences buying behavior by educating the consumer
Comparative advertising: compares product qualities to competing products’ qualities
Defensive advertising: counters competitors’ advertising claims
Persuasive advertising: appeals to consumers’ emotions
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
How can you recognize and protect yourself from deceptive advertising?
Approach buying decisions in an organized, logical manner
Gather information from several sources (in addition to the advertisement)
Evaluate the information
Consider alternative choices
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
LESSON 1.6
Be a Responsible Consumer
GOALS
Identify ways in which your consumer decisions affect other people.
Explain why you should use resources responsibly.
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
KEY TERM
global warming
© 2010 South-Western, Cengage Learning
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ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Consumers in Society
Sharing limited resources
Protecting public safety
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
Using Natural Resources
Resource consuming products
Water
Forest products
The environment
Encourage business responsibility
Dispose of waste responsibly
Respect your neighbors
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
How can your consumer choices affect the people around you?
What can you do to be a more environmentally responsible consumer?
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
How can your consumer choices affect the people around you?
The earth’s natural resources are limited and not quickly replaced
To be environmentally responsible, use resources in moderation and recycle or conserve them
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
ECONOMIC EDUCATION FOR CONSUMERS ○ Chapter 1
What can you do to be a more environmentally responsible consumer?
Consider how your choices affect the use of resources and their impact on the environment
Dispose of waste responsibly
Encourage businesses to act responsibly through your buying decisions
Recognize that you live in a world community and act with consideration toward others
© 2010 South-Western, Cengage Learning
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© 2010 South-Western, Cengage Learning
