THE ROLE OF CONSUMER IN THE ECONOMY

DENISE, DEALODELA CRUZ, CLARISSE

ERNACIO, ALEALAÑA, ANGELICA

ROLE OF THE CONSUMER

1.Purchasing Goods and Services

2.Maximize Utility3.Make rational

purchasing decisions

PURCHASE GOODS AND SERVICESThe main role of the consumer is to spend money. How much money a person spends is primarily based on his/her income.

MAXIMIZE UTILITYConsumers play a role in the economy by maximizing utility, which means allocating their scarce resources, such as limited time or money, most efficiently.

MAKE RATIONAL PURCHASING DECISIONSEconomic consumer theory hinges on consumers making rational buying decisions. The role is to measure all possible outcomes of their choices and use this knowledge to make an informed decision.

TRAITS OF A SMART CONSUMER

Seeks value for every money spent

PANIC BUYING

Knowing the quality firstHas alternatives

Follows the budget

Seeks variety

SOURCES OF INCOMEPAYDAY!!

!

Households derive their incomes from three basic sources:

1.From wages or salaries in exchange of labor;

2.From property – that is, capital, land, and so on

3.From government

WAGES AND SALARIESWages and salaries in cash consist of wages or salaries payable at regular weekly, monthly or other intervals, including payments by results and piecework payments; plus allowances such as those for working overtime; plus bonuses; plus commissions, gratuities and tips received by employees.

INCOME FROM PROPERTYProperty income is the income from the ownership of real property and financial holdings. It takes the form of profits, interest, dividends, and rents.

INCOME FROM THE GOVERNMENT: TRANSFER PAYMENTSIncome from the governments are in the form of transfer payments. Transfer payments are payments by government to people who do not supply goods or services in exchange. Some, but not all, transfer payments are made to people with low incomes. Transfer programs are largely designed to provide income to those in need.