personal finance chapter 12. © emc publishing, llc consumer awareness consumer movement began in...

Personal Personal FinanceFinance

Chapter 12Chapter 12

© EMC Publishing, LLC

Consumer AwarenessConsumer Movement

• Began in the late 1800s – Meatpacking plants

– The Jungle

What do you think?Discussion

© EMC Publishing, LLC© EMC Publishing, LLC

• Have you read The Jungle, by Upton Sinclair? What did you think?

• What impact did that book have on government and the rights of the people?

• Are there any books today that have had that type of impact on society and government? If no, why not?


Consumer AwarenessThree Roles

• Producer– Advertise




– Provide toll-free numbers





– Provide warranties






– Use Energy Star label






– Use Energy Star label

– Get Seal of Approval (Good Housekeeping)



• Producer

• Consumer– Make informed choices

• Find product information

• Do product comparisons

• Ask for recommendations


Consumer AwarenessThree Roles• Producer• Consumer

– Make informed choices– Communicate opinions

• Write letters• Tell retailers• Return surveys


Consumer AwarenessThree Roles• Producer• Consumer

– Make informed choices– Communicate opinions– Work together

• Boycott • Use lobbyists• Form consumer interest groups



• Producer

• Consumer

• Citizen– Vote

– Communicate with elected officials

– Learn about government agencies


Consumer AwarenessGovernment Agencies

• Federal Trade Commission (FTC)




• United States Postal Service





• Federal CommunicationsCommission (FCC)






• Food and DrugAdministration (FDA)






• Food and Drug Administration (FDA)

• Surface Transportation Board


Consumer AwarenessGovernment Agencies• Federal Trade Commission (FTC)• United States Postal Service• Federal Communications

Commission (FCC)• Food and Drug Administration (FDA) • Surface Transportation Board• Consumer Product Safety Commission

(CPSC)


Consumer AwarenessGovernment Regulation

• Debate for– Protects against price gouging

– Promotes product standards

– Supports consumer safety


Consumer AwarenessGovernment Regulation

• Debate against– Impedes caveat emptor

– Limits competition

– Hurts economy (companies lose money)

– Deregulation cuts “red tape”


Which of the following government agencies regulates the safety of our food?

A. FTC

B. FDA

C. CPSC

D. FCC

E. FEC



• Do state governments as well as the federal government regulate commerce? What is the difference?

• How do consumers know what rights they have?

• Should the government increase or decrease regulation? Why?


Consumer RightsLegislation

• Consumers’ Bill of Rights – 1962– Right to safety

– Right to be informed

– Right to choose

– Right to be heard

http://upload.wikimedia.org/wikipedia/commons/c/c3/John_F._Kennedy%2C_White_House_color_photo_portrait.jpg


Consumer RightsRight to Safety

• Safe cars– Car seats




• Safe water




• Safe water

• Safe food




• Safe water

• Safe food

• Protection against lead and toxins


Consumer RightsRight to Be Informed

• Home shopping– Internet

– Catalogs

– TV

– 30-day rule



• Telemarketing– Do Not Call

(http://fin.emcp.net/donotcall)

http://www.donotcall.gov/





• Contract– Mutual assent

– Consideration

– Competent parties



• Consumer fraud– Pyramid schemes

– Internet

Consumer RightsRight to Choose

• Competition (markets)– Competitive




– Oligopolistic




– Oligopolistic

– Monopolistic


Consumer RightsRight to Be Heard

• Government import policy– Tariffs

– Quotas

– NAFTA


Dear Better Business Bureau:

Recently I purchased a newwashing machine from …


• Better Business Bureau



• Better Business Bureau• Lodging a complaint (advance to see sample)



• Next step after letter of complaint– Legal / Court

• Consumer action panels

• Arbitration

• Small-claims court

• Lawsuit

• Class-action suit


Consumer RightsFraud on the Internet

• Phishing – identity theft

• E-mail scams

• Redirecting to another site


Consumer RightsFraud on the Internet

• Tips– Hot spot – WiFi (theft is easier)

– Use secure site for data (shttp or https)

– Make sure company is reputable, if possible

– Print copy of all transactions

– Report phishing to [email protected]

mailto:[email protected]


Which of the following is not a right from the Consumers’ Bill of Rights passed in 1962?

A. Right to be informed

B. Right to safety

C. Right to be heard

D. Right to choose

E. Right to freedom of religion



• Do you use eBay or any other online auction site? How does it work?

• What tips do you have for shopping on the Internet?

• Have you ever had a bad experience online? Explain.

personal finance chapter 12. © emc publishing, llc consumer awareness consumer movement began in...

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