YOUR ROLE AS A CONSUMER

CHAPTER 3

M A I N I D E A : A S A C O N S U M E R , YO U P L AY A N I M P O RTA N T R O L E I N T H E E C O N O M I C

S Y S T E M

CHAPTER 3 SECTION 1: CONSUMPTION, INCOME, AND DECISION MAKING

VOCABULARY

• Consumer• Disposable income• Discretionary income• Rational choice

NOTES

• Describe the difference between disposable income and discretionary income• What three considerations should govern your

decision making as a consumer?a.b.c.

SPECIAL NOTE FROM TEACHER

• Take a moment to look at the graph on page 62 and figure 3.4 on page 63

M A I N I D E A : B E WA R E O F A DV E RT I S E M E N T S

CHAPTER 3 SECTION 2: BUYING PRINCIPLES OR

STRATEGIES

VOCABULARY

• Competitive advertising• Informative advertising• Bait and switch• Comparison shopping • Warranty• Brand name• Generic brand

NOTES

• What trade offs occur when you are gathering information about a product?• What forms of advertising exist?• Based on experiences you have had, what kind of

ads should you be aware of?• How do you comparison shop?

M A I N I D E A : Y O U M U S T B E A P R O A C T I V E C O N S U M E R T O F I N D R E L I A B L E P R O D U C T S A N D S E R V I C E S .

CHAPTER 3 SECTION 3: CONSUMERISM

VOCABULARY

• Consumerism• Ethical behavior

NOTES

• What are your rights as a consumer?a.b.c.d.e.

NOTES

• What private and federal help can you get as a consumer?• What are your responsibilities as a consumer?• A• B

ACTIVITY TO TURN IN

• Write a letter to the Bureau of Consumer Protection, 600 Pennsylvania Ave. NW, Washington, DC 20580. Use the letter on page79 as a template. Your letter should include a real or make believe scenario in which you would like to report a faulty product. Include the name of the product, the fault you have with the product in detail, any action you have taken to fix the problem, and what you expect to be done about the faulty product.

G O I N G I N T O D E B T

CHAPTER 4

M A I N I D E A : T H E N A T I O N ’ S E C O N O M Y D E P E N D S O N C R E D I T

CHAPTER 4 SECTION1: AMERICANS AND CREDIT

VOCABULARY

• Credit• Principal• Interest• Installment debt• Durable goods• mortgage

NOTES

• What are the advantages of repaying installment debt over a long period?• Why do people go into debt?• What factors will help you decide whether or not

to use credit?

M A I N I D E A : T H E R E A R E 2 T Y P E S O F C R E D I T , B U T B E W A R E O F I N T E R E S T R A T E S

CHAPTER 4 SECTION 2: SOURCES OF LOANS AND

CREDIT

VOCABULARY

• Commercial bank• Savings and loan association• Savings bank• Credit union• Finance company• Charge account• Credit card• Finance charge• Annual percentage rate (APR)

NOTES

• List the 6 types of financial institutions:1.2.3.4.5.6.

NOTES

• What are the 3 kinds of charge accounts available in stores?• How are credit cards used?• How is a finance charge different from an annual

percentage rate?

NOTES

• List and briefly describe the different methods used to compute finance charges:

M A I N I D E A : H A N D L E YO U R D E B T

CHAPTER 4 SECTION 3: APPLYING FOR CREDIT

VOCABULARY

• Credit bureau• Credit check• Credit rating• Collateral• Secured loan• Unsecured loan

NOTES

• What factors determine a person’s credit rating?

• How can you be a responsible borrower?

M A I N I D E A : G O V E R N M E N T R E G U L A T I O N I S N E C E S S A R Y T O P R O T E C T C O N S U M E R S

CHAPTER 4 SECTION 4: GOVERNMENT

REGULATION OF CREDIT

VOCABULARY

• Usury law• bankruptcy

NOTES

• How does the Equal Credit Opportunity Act affect consumer credit?

• Why do people declare a personal bankruptcy?

• List and describe the major federal laws regulating consumer credit:

B U Y I N G T H E N E C E S S I T I E S

CHAPTER 5

M A I N I D E A : A M E R I C A N S C A N B U Y A V A R I E T Y O F F O O D S

CHAPTER 5 SECTION 1: SHOPPING FOR FOOD

VOCABULARY

• Club warehouse store• Convenience store• Private-labeled products

NOTES

• What are the advantages of comparison food shopping?

• Fill in chartAdvantages of shopping at club warehouse stores:

Disadvantages of shopping at club warehouse stores:

M A I N I D E A : A M E R I C A N S L I K E A V A R I E T Y O F C L O T H E S

CHAPTER 5 SECTION 2: CLOTHING CHOICES

VOCABULARY

• Durability• Service flow

NOTES

• What 3 factors determine clothing value?• When should you take advantage of clothing

sales?

M A I N I D E A : T H E R E A R E D I F F E R E N T W A Y S T O O B T A I N H O U S I N G

CHAPTER 5 SECTION 3: TO RENT OR TO BUY

VOCABULARY

• Closing costs• Points• Lease• Security deposit

NOTES

• What are the three rules to determine how much to spend for a house?• What rights do renters have?• What responsibilities do renters have?

M A I N I D E A : M U C H T H O U G H T S H O U L D G O I N T O B U Y I N G A V E H I C L E

CHAPTER 5 SECTION 4: BUYING AND OPERATING

A VEHICLE

VOCABULARY

• Registration fee• Liability insurance

NOTES

• What are the 3 trade offs when buying a vehicle?• What costs are involved in operating a vehicle?• Teacher note: read over checklist pg. 131

S AV I N G A N D I N V E S T I N G

CHAPTER 6

M A I N I D E A : Y O U S H O U L D S E T M O N E Y A S I D E F O R L A T E R U S E

CHAPTER 6 SECTION 1: WHY SAVE?

VOCABULARY

• Saving• Interest• Passbook savings account• Statement savings account• Money market deposit account• Time deposits• Maturity• Certificates of deposit

NOTES

• When should you save money?• How do passbook, statement, and money market

accounts differ?• What are the advantages of time deposits?

M A I N I D E A : I N V E S T I N G C A N B R I N G P R O F I T O R L O S S

CHAPTER 6 SECTION 2: INVESTING: TAKING RISKS WITH YOUR

SAVINGS

VOCABULARY

• Stockholders• Capital gain• Capital loss• Tax-exempt bonds• Savings bonds• Treasury bills• Treasury notes• Treasury bonds• Broker• Over-the-counter market• Mutual fund• Money market fund

NOTES

• What is the difference between a stock and a bond?• Give the name for the following and briefly

describe what they are:• NYSE• NASDAQ• DJIA• S&P

M A I N I D E A : A D D I T I O N A L I N C O M E S M A Y B E N E E D E D D U R I N G R E T I R E M E N T

CHAPTER 6 SECTION 3: SPECIAL SAVINGS PLANS

AND GOALS

VOCABULARY

• Pensions plans• Keogh Plan• Individual retirement account (IRA)• Roth IRA• diversification

NOTES

• What kinds of retirement investments are available?• How much should you save and invest?• Why is risk an important factor when deciding

how much to save or invest?