Consumers In Society

Consumer Economics

The study of economic interactions of consumers with their external environment

-involves economic analysis of market and non market consumption activities, incorporation relative social, psycholoigical, political and ecological considerations.

Consumer

One who acquires goods and services for ultimate consumption or use by a person, family or a household

-consumers responsible for 2/3 of all economic activity

- ultimate goal is to produce goods/services for consumers

Economic activities performed by consumers:

earning- wages salary profits

spending/consuming- a lot but not too much

utilizing- how do we use out time

boroowing- necessary for most(house car)

saving- money you don’t consume

investing- must be element of risk- money work for you

Economic System

-A mechanism by which land labor nat resources labor and capital are brought together in order to produce and then allocate goods and services to people.

Natural Resources may be

Renewable- trees water

Non renewable- oil fossil fuels

Inexhausted- solar power

Economic Systems

Capitalism- ind based private ownership; free market economy

Socialism- community based; govnt ownership

Political Systems:

Democracy- freedom to vote

Communism- no right to vote

-most economic/ political systems are mixed

-generall cap-dem; soci- comm. But exceptions (china)

4 Groups In US economy

1. Consumers- maximizes utility with goods and services

2. Producers- mazimizes profits through sales of goods and services

3. Government- promotes safety/welfare of public

4. Foreign sector- provides products and external markets for US goods and services

Socializing Costs and Privatizing Benefits

-spreads cost of running business over more people (involving others)

Ex. Dumping waste in a river- many more people affected by what company is doing

Assumptions for Consumer Sovereignty

1. Man is a rational being

2. Consumers have perfect information

Consumer Sovereignty-

Market situation where consumers have the power

Ultimitaly decide which products and services society will produce and consume

Producer Sovereignty

Producers have the power to decide which products and services society will produce and consume

Consumer Choice

Market condition that exists when consumers have the power to ultimately decide which products and services society will produce and consume.

Producer Sovereignty

Producers have the power to decide which products and services society will produce and consume

Consumer Choice

Market condition that exists when consumers are presented with options from which they can choose to buy or not

The Health Of the Economy

1. Consumer attitudes вЂ" indicators of economic confidence . If we aren’t confident in the economy in economy. Then we may not buy… which could create an economy that it what we cfeared it was originally.

2. Index of leading economic indicators.

3. Measures of economic growth

GDP)gross domestic product) total calue of all goods and services produced in the US regardless of ownership, over a period of time such as 1 year, measured in dollars

Real