Civics Chapter 18

Federal Trade Commission

(FTC) has the power to bring to court any company anywhere in the U.S. that uses false or misleading advertising/false labeling

gross domestic product

(GDP), the market value of all goods and services produced annually in the United States

true

*TRUE OR FALSE* Factories often sell goods in large quantities to a wholesaler

false

*TRUE OR FALSE* Wise shoppers choose goods/services at the price/quality that worst suits their needs.

rivers

- Advantages: • Manufactures located close to major rivers, shipping can be fast & inexpensive - Disadvantages: • Subject to the weather.

highways

- Automobile is the leading means of transportation in the U.S. - 85% of families do most of their traveling in personal vehicles. - Trucks are the leading means of transporting goods in this country. - U.S. has about 4 million miles of roads. - Highway transportation depends on good roads & a steady supply of fuel.

railroads

- Carry bulk cargo, such as coal & grain. - Brought new goods to every American city. - Gave business people a mean of rapid travel & communication. - In the 1960s/1970s many of these went out of business due to other competing means of transportation (trucks, buses, cars, planes).

airlines

- Now carry all first-class mail between U.S. cities located over a certain distance apart. - Much cheaper to ship items by rail road or by truck - Transportation of goods by air has some problems: • Can't carry as much heavy cargo at the same time • Large cargo planes can't land at small airports • Higher prices due to aviation fuel • Increased security due to 9/11 terrorist attacks

repair services

- Performed on goods you own, usually to repair them, or keep them in good working condition or improve them. (auto repair, auto maintenance, heat maintenance)

other services

- Retail services: malls, online purchases, entertainment, movies, music, etc.

personal services

- They are performed directly on consumers. (Medical care, personal fitness, yoga, golf lessons, etc.)

bank loan

A good credit rating, meaning you pay your bills on time is important for obtaining any ____ ____.

depends

America's production of goods _______ on the process of mass production.

billboards

Businesses spend billions of dollars trying to get us to buy their products. They run ads in newspapers, magazines, internet, __________, radio, & TV. They often create slogans people will remember.

computer

Consumers shop online viewing goods/services on their ________. They often seek insurance quotes, automobile prices, etc. online

home financing

Credit is all money borrowed, except ____ _________.

credit card debt

Customers must be careful not to make foolish purchases or run up ______ ____ ____.

railroads

Development of _________ sped things up a bit, but an efficient economy would need more effective ways to get products from the manufacturers to the consumers.

assembly line

Each worker is highly skilled at a specialized job. An ________ ____ moves the product through stages of production until the product is complete.

horse

Early days goods were delivered by _____ & by carriage/boat. It was very slow & time consuming.

Mass marketing helps the economy because it is selling goods in large quantities, which means that consumers have the opportunity to buy more.

How does mass marketing help the U.S. economy?

You should go out and buy 24 rolls of paper towels because you use those more often.

If an item, such as paper towels or tomato sauce, is on sale at a low price, is it a good idea to rush out & buy 24 rolls of paper towels or 24 cans of tomato sauce? Why or why not?

copy

If one company begins to use a successful innovation, its competitors have to ____ the innovation if they are going to remain competitive.

Better Business Bureau

If you aren't satisfied with a good/service you have purchased you can contact the local ______ ________ ______. They give advice/assistance to people who believe they have been cheated/treated unfairly by a business.

penalties

If you miss a payment there can be _________.

high

Interest rates paid on unpaid balances can be very ____.

important

Learn when/where to buy a product. As consumers we play an _________ part in the economy, but we must learn to be responsible shoppers.

brand names

Many people will only buy _____ _____, they believe from past experience that the brand name is of good quality.

It would be less accurate because things that are put on the Internet might not be true or might not be factual. Some things on the Internet are opinions.

Many services are offered on the internet, is information offered by Internet sellers likely to be more or less accurate than information in a national magazine? Explain your answer.

economists

Market value of all goods/services produced annually in the U.S. is the GDP (gross domestic product). __________ use to see how well the U.S. economy is performing.

in the U.S.

Mass production was first developed where but is now done around the world?

aware

Once the goods are shipped or the services are available, consumers must be made _____ of their availability. This is where marketing comes into play.

factory

Products pass through several hands when moving to a _______ to finally the consumers.

requires

Selling goods in large quantities often ________ mass marketing. It involves preparing products that are the same wherever they are sold.

fastest

Service sector has become the _______ growing part of the U.S. economy

annual

Some cards may have an ______ card fee.

less

Some people buy generic products. They are often ____ expensive than the brand name products.

shop lifting

Some people cause problems for businesses by ____ _______, breaking or damaging store property, or failing to pay for purchase gotten on credit. This adds to the cost of doing businesses, businesses pass on these costs to consumers.

restaurants

Some products are a combination of goods/services. What is an example?

Thomas Edison.

The source of power that contributed to modern mass production was electricity. Who was said to have given us electricity?

retailer

The wholesaler then sells it to the ________

large scale production

Today, mass production is an essential part of what?

1) Unemployment rate 2) Business failure rate 3) Amount of tax revenue American businesses/citizens produce

What are other measures of how our economy is performing?

1. Railroads 2. Airlines 3. Highways 4. Rivers

What are the four main ways that goods are transported to consumers?

1. Charge account 2. Credit cards 3. Installment plans

What are three ways of paying for a product later?

1. Cash 2. Checks 3. Debit card

What are three ways of paying for a product now?

1. Wholesalers 2. Retailers

What are two problems that consumers face when selecting a service provider?

1) Studying advertisements 2) Using coupons 3) By watching for sales

What are ways consumers can save money?

1) Health 2) Educational 3) Personal 4) Information

What do services include?

The CPSC makes sure that the products going out on the market are safe to play with and won't hurt anybody or make anybody sick.

What does the Consumer Product Safety Commission (CPSC) monitor?

See if you can get a refund or if you can replace that item.

What is the first step you should take if you think that you have been misled about a product or that the product you purchased is defective?

The goal of an advertiser is for a consumer to buy what they are selling.

What is the goal of an advertiser?

to develop machine tools that can produce exactly identical part

What is the key to mass production?

You must take a risk to make innovations, and you earn profits by those innovations and by owning your own business.

What is the relationship between innovation, taking risks, and earning profits?

It is easier for services to get money if the consumer can receive the product in different ways.

Why can services be delivered to consumers in so many different ways?

The introduction of electrical power had a big impact on the U.S. economy because more jobs can be created and businesses can produce mass productions of goods. It enabled mass production by machines.

Why did the introduction of electrical power have such an impact on the U.S. economy?

Services are easier to provide in today's economy because of the technology given to us.

Why has the U.S. economy moved away from producing goods and focused more on providing services?

The federal government has the power to protect consumers because they want to make money, and that comes from people buying from stores.

Why is it important that the federal government have the power to protect consumers?

It's important to be a wise consumer because you want to get the best prices of goods and you want to save money.

Why is it important to be a wise consumer?

The U.S. has focused more on producing services rather than producing goods.

Why is the U.S. economy sometimes called a service economy?

internet purchasing

Your credit card information could be stolen by using the phone or ________ __________.

free-market economy

____-______ _______ allows people willing to take risks by offering them the possibility of making a profit.

wholesaler

a business who owns a large warehouse where goods are stored

charge account

a form of credit that stores grant to many of their consumers

brand

a name given by the maker to use a product or range of products

consumer

a person who buys or uses goods and services

generic product

a product that does not have a manufacturer's name or brand

standard packaging

adds to the efficiency of self-service (crackers, sugar, etc.)

installment plans

allows consumers to buy goods without paying the full amount when they make their purchases. The consumer puts down a down payment and the rest of what the consumer owes is called the balance. The balance is then paid in equal installments for a certain period of time. (Mortgage)

self-service

an efficient & inexpensive way to sell goods because it saves time & labor

advertising

informs people about products & tries to persuade consumers to buy the products; often makes the difference between the success/ failure of a product; the goal: to give the consumer a reason to buy their product

one price system

prices are stamped or bar-coded (Universal Product Code UPC onto products). This code contains information about the product & allows the cashiers to ring up items quickly. Bar codes can also keep track of products during shipping, inventory, keeping shelves stocked

Nutrition Labeling & Education Act of 1990

required food companies to list serving sizes, fat content, cholesterol, etc. contained in each serving

Fair Packaging & Labeling Act

requires businesses to supply certain info., package contents, & the weight or quantity of the items in the package

Dept. of Agriculture

sets nationwide standards, inspects & grades meats & poultry

credit cards

similar to the charge cards provided by banks and other lending institutions.

impulse buyer

someone who buys without thinking before buying

innovation

the development of a new product, system, or process that has wide ranging effects on the economy

profit

the difference between the total cost of production and the total revenues from buyers

marketing

the process of making goods and services available to consumers and convincing them to buy the product

mass marketing

the process of selling a good or a service in which the same product, price, promotion, and distribution is used for all consumers in a particular market

mass production

the rapid production by machine of large numbers of identical objects

goods

things that are manufactured (made) and that consumers can buy and own

services

things that people do

1) personal services 2) repair services 3) other services

types of services

debit cards

usually looks just like a credit card but it operates the same way that a check does

1) railroads 2) airlines 3) highways 4) rivers

ways of transportation today

check

written/signed order to a bank to pay a sum of money from a checking account to a person/company