Information Sheet 1

CONSUMER RIGHTS AND RESPONSIBILITIES

Learning Objectives:
After reading this information sheet, the students are expected to:

a. examine the eight consumer rights;

b. discuss the five major consumer responsibilities;

c. analyze the regulations and legal action that help protect consumers.

In the fields of economics, marketing and advertising, a consumer is generally

defined as the one who pays to consume the goods and services produced by a
seller. A consumer can be a person or group of people, generally categorized as
an end user or target demographic for a product, good, or service. Time was
when consumers looked only at the price in deciding to buy. Not anymore.
Buying patterns the world over have changed with the advent of more
competition, inventions and innovations in products and services. Consumers
now check for quality, and only later the price. Value for money is how marketing
men analyze the demand of today’s buyers. Consumers are given with their
rights and responsibilities that will protect them in times of purchasing. And with
these rights are the responsibilities defined in order to dwell deeper into the role
of a consumer in society.
Republic Act No. 7394 or The Consumer Act of the Philippines “is the policy of
the State to protect the interests of the consumer, promote his general welfare
and to establish standards of conduct for business and industry.” The rights and
responsibilities of every consumer are being included in the Consumer Act of the
Philippines and these are as follows:

1. Right to basic needs

This is which consumers can guarantee survival, adequate food, clothing,

shelter, health care, education and sanitation. Consumers may look forward to
the availability of basic and prime commodities to consumers at affordable prices
and of good quality.

2. Right to safety

The right to be protected against the marketing of goods or the provision of

services that are hazardous to health and life.

You may look forward to:

 Manufacturers of consumer products to undertake extensive safety and

performance testing before selling their products in the market.

 Labels which contain the proper information as regards the product, its

use and how to operate it, if the need arises, and also precautions or
warning signs.

3. Right to information

This protects consumers against dishonest or misleading advertising or labelling.

It also provides the right of facts and information to help the consumers make an
informed choice. Consumers will be able to look for complete information about
the product to be purchased, including its use, ingredients/chemical contents,
precautions, if any, limitations and expiry date.

4. Right to choose

The right to choose products at competitive prices with an assurance of

satisfactory quality. In which consumer may look forward to a wide array of goods
and services which are offered in the market with diverse brands, sizes, shapes
and colors with differences in the price, quality and use.

5. Right to representation
The right to express consumer interests in the making and execution of
government policies. Legislators would propose laws that would ensure that
consumers have the chance to live a better life by getting the best value for their
hard-earned peso.

6. Right to redress

The right to be compensated for misrepresentation, shoddy goods or

unsatisfactory services. Manufacturers/storeowners would replace defective
goods pursuant to the provision "No Return, No Exchange" provided in the DTI's
Implementing Rules and Regulations of Republic Act 7349, otherwise known as
the Consumer Act of the Philippines.

7. Right to consumer education

The right to acquire the knowledge and skills necessary to be an informed

consumer. Consumer education being integrated in the school curriculum from
elementary to secondary levels as mandated by R.A. 7394 also known as the
Consumer Act of the Philippines.

8. Right to a healthy environment

It is the right to live and work in an environment which is neither threatening nor
dangerous, and which permits a life of dignity and well-being.

You may look forward to:

 The government exerting an iron hand regarding the alarming increase in

the degradation of the environment, especially forests, dying wildlife,
depleted land fill space and environmental contamination to prevent
further damage.

CONSUMER RESPONSIBILITIES

Consumers have five responsibilities: critical awareness; action; social concern;

environmental awareness; and solidarity. When put into practice by the
consuming public, they can greatly contribute in achieving the ideal state of
consumer protection in the country.

Critical awareness
The consumer responsibility to be more alert and questioning about the use,
price and quality of products and services. You are given the right to information
therefore; you have the responsibility to ask questions. How much is this
product? What can it do? Is it safe to use? What are its hazards to my health?
These are very basic questions, and the answers to them are very important in
guiding and assuring consumers to get the best value for their money.
Action
The consumer responsibility to assert yourselves and act to ensure that you get a
fair deal. Remember that as long as you remain passive consumers, you will
continuously be exploited. You have your rights so you can be empowered to
seek for what is due to you. The government is here to support and protect your
welfare and your rights, but it is up to you to make use of them responsibly.
Social concern
The consumer responsibility to be aware of the impact of our consumption to
other citizens, especially the less fortunate, exploited, disadvantaged or groups
whether in the local, national or international community. In today’s difficult times
where resources are scarce, it is your responsibility as consumers to think of
what will be the effect of your actions and choices to other people’s lives. Make
use of our resources wisely and never be wasteful. Practice conservation and
share with those who are in need.
Environmental awareness
The consumer responsibility to understand the environmental consequences of
your consumption. You should recognize your individual and social responsibility
to conserve natural resources, and protect Earth for the future generations. The
planet we are living in is our only home. We should protect and preserve it, for it
is our only our source of life. Practice proper waste management and follow the
three R’s – reuse, reduce and recycle. Choose and make use of environment-
friendly products. It can save our natural resources and refrain from causing
damage to them.
Solidarity
The consumer responsibility to organize together to develop the strength and
influence to promote and protect the rights, welfare and interests of the
consuming public. Make your voices heard as a united consumer sector.
Cooperate and collaborate with the government in ensuring consumer protection
in the country. Organize yourselves to come up with better legislations in
safeguarding your welfare, and refining the way we engage business in our
nation. It is when we are united that we can accomplish greater things.
Imagine if every Filipino consumer asserts his or her rights and fulfills his or her
responsibilities, then achieving the ultimate state of consumer protection in the
country will no longer be just an idea but a possibility.
SELF-CHECK

Multiple Choice
Choose the letter of the best answer.

1. are the individuals who purchase goods and services for

personal use.
a. Producers c. Clients
b. Consumer d. Consumer protection

2. It is an act mandated by the constitution to protect the welfare and interests of

the consumers. It is also known as the Consumer Act of the Philippines.
a. RA 7394 c. RA 7943
b. RA 7349 d. RA 7439

3. Which of the 8 basic consumer rights that protect consumers from fraudulent
advertising, mislabeling and misinterpretation?
a. Right to Basic Needs c. Right to Choose
b. Right to Redress d. Right to Information

4. It is the right of the consumer to express consumer interests in the making and
execution of government policies.
a. Right to Basic Needs c. Social Concern
b. Right to Representation d. Right to Choose
5. “We need guarantees to survival, which is, adequate food, clothing, shelter,
health care, sanitation, and education”. What consumer right that will refer to this
statement?
a. Right to Basic Needs c. Right to Consumer Education
b. Right to Safety d. Right to Choose

6. It is a consumer responsibility that tells consumers to be more alert and

questioning about the use, price and quality of products and services.
a. Critical Awareness c. Redress
b. Representation d. Consumer Education

7. Which of the five consumer responsibilities that deals to organize together in

developing the strength and influence to promote of the consumers and protect
their rights.
a. Solidarity c. Environmental Awareness
b. Critical Awareness d. Action

8. is the right of the consumer to compensate for

misrepresentation of poor quality goods or unsatisfactory services.
a. Right to Choose c. Right to Information
b. Right to Redress d. Right to Consumer Education

9. Consumers should be able to understand the environmental consequences of

your consumption. What consumer responsibility being referred above?
a. Critical Awareness c. Environmental awareness
b. Solidarity d. Social Concern
10. What provision or policy that is being provided in the DTI’s Implementing
Rules and Regulations of Republic Act 7394 under the Right to Redress in which
manufacturers/ storeowners would replace defective goods pursuant to this
provision?
a. No ID, No Entry c. No Return, No Exchange
b. Anti-Hoarding Policy d. No Facemask, No Ride
Answer Key

1. B
2. A
3. D
4. B
5. A
6. A
7. A
8. B
9. C
10. C

References:
http://naciphil.tripod.com/id9.html
https://courses.lumenlearning.com/boundless-marketing/chapter/introduction-to-
consumers/
https://www.philstar.com/opinion/2001/10/27/138047/consumer-rights-amp-
responsibilities
https://www.manilatimes.net/2013/08/18/business/consumer-
responsibilities/30829/
 Information Sheet 2
CONSUMER LEGISLATION/CONSUMER PROTECTION LAWS

Learning Objectives:
After reading this information sheet, the students are expected to
a. define consumer protection;
b. elaborate the objectives under consumer protection law;
c. analyze the importance of consumer protection laws to the consumers

Consumer protection is the practice of safeguarding buyers of goods and

services, and the public, against unfair practices in the marketplace. Consumer
protection measures are often established by law. Such laws are intended to
prevent businesses from engaging in fraud or specified unfair practices in order
to gain an advantage over competitors or to mislead consumers. They may also
provide additional protection for the general public which may be impacted by a
product (or its production) even when they are not the direct purchaser or
consumer of that product. For example, government regulations may require
businesses to disclose detailed information about their products—particularly in
areas where public health or safety is an issue, such as with food or automobiles
Consumer protection law or consumer law is considered as an area of law that
regulates private law relationships between individual consumers and the
businesses that sell those goods and services. Consumer protection covers a
wide range of topics, including but not necessarily limited to product
liability, privacy rights, unfair business practices, fraud, misrepresentation, and
other consumers/business interactions.
The Philippine government adopted Republic Act 7394 known as the Consumer
Act of the Philippines as the legal basis for consumer protection in the country.
The law embodies the state policy on the protection of consumers and
establishes standards of conduct for business and industry in the country and
was promulgated on July 15, 1992.
The Act aims to protect the “interest of the consumer, promote his general
welfare and establish standards of conduct for business and industry” in which
the State shall implementing measures in achieving the following objectives:
a. protection against hazards to health and safety;
b. protection against deceptive, unfair and unconscionable acts and
practices;
c. provision of information and education to facilitate sound choice and
the proper exercise of rights by the consumer;
d. provision of adequate rights and means of redress; and
e. involvement of consumer representatives in the formulation of social

and economic policies.

Government agencies in the Philippines implement the "Consumer Act of the
Philippines" and their areas of concern are as follows:

 Department of Health with respect to food, drugs, cosmetics, devices and

substances;
 the Department of Agriculture with respect to products related to
agriculture,
 the Security and Exchange Commission with respects to credit facilities
extended to consumers by financing companies,
 the Department of Education with respect to the consumer education and
information,
 the Department of Trade and Industry with respect to other consumer
products and other related areas that are not specified above.

Amongst all the relevant departments involved in the implementation of RA 7394,

the DTI plays the central role. It is also the focal point for the ASEAN Consumer
Protection Committee (ACPC).

SELF-CHECK

Multiple Choice
Choose the letter of the best answer.

1. It serves as the legal basis for consumer protection in the Philippines.

a. Consumer Act of the Philippines c. Both A and B
b. Lemon Law d. All of the choices

2. The practice of safeguarding buyers of goods and services, and the public,
against unfair practices in the marketplace is called .
a. Consumerism c. Policies
b. Financing d. Consumer Protection Law

3. Which government agencies that plays the central role in the implementation
of the RA 7394?
a. DOH c. SEC
b. DTI d. Both B and C

4. The provisions of the law shall be enforced by what government agencies with
respect to food, drugs, cosmetics, devices and substances?
a. DOH c. SEC
b. DTI d. DEPED

5. What is the complete name of ACPC?

a. ASEAN Customer Protection Committee
b. ASEAN Consumer Power Committee
c. ASEAN Consumer Protection Committee
d. ASEAN Customer Production Committee
6. When does RA 7394 or also known as the Consumer Act of the Philippines
came to effect?
a. June 12, 1992 c. July 15, 1992
b. June 21, 1992 d. July 15, 1991

7. This may require businesses to disclose detailed information about their

products—particularly in areas where public health or safety is an issue, such as
with food or automobiles.
a. Government Agencies c. Government Sectors
b. Government Regulation d. All of these

8. Consumer protection law or consumer law is considered as an area of law that

regulates law.
a. Private c. Both Public and Private
b. Public d. None of these

9. Who are being protected by the Republic Act 7394 based on his interests and
general welfare in purchasing goods and services?
a. Manufacturer c. Consumer
b. Producers d. All of these

10. This government agency is the one who is assigned to give proper consumer
education and information to people.
a. DOH c. DTI
b. DOST d. DEPED

Answer Key
1. A
2. D
3. B.
4. A
5. C
6. D
7. B
8. A
9. C
10. D

References:
https://aseanconsumer.org/selectcountry=Philippines
https://en.wikipedia.org/wiki/Consumer_protection#:~:text=Consumer
%20protection%20is%20the%20practice,are%20often%20established%20by
%20law.
https://www.slideshare.net/deartaskie/consumers-welfare-and-protection
https://www.centerforfinancialinclusion.org/client-protection-in-the-philippines
https://www.officialgazette.gov.ph/1992/04/13/republic-act-no-7394-s-1992/

Information Sheet 3
IMPACT OF CONSUMER PROTECTION LAWS

Learning Objectives:
After reading this information sheet, the students are expected to
a. identify the different implementing agencies;
b. elaborate the impacts of consumer protection laws to different sectors;
c. value the importance of the existence of the consumer protection law.
The Consumer protection act is one of the first pieces of legislation to protect
consumer’s rights, interests, and their general welfare. If you run your business
honestly and fairly then you could not have any problems adhering to the Act.
The main function of this law now is to protect consumers against product
liability. Protection against product liability means that consumers are protected if
the product they purchase from you is defective and causes further damage.
However, we as consumer can also think the impacts of the consumer protect
laws to different sectors in the country. For you to be able to understand, here’s
what you need to know.

ECONOMIC IMPACT
 Consumer Act of the Philippines (RA 7394)
 Provides protection to consumers against hazards to health and safety
and deceptive, unfair and unconscionable sales acts and practices
 Implementing agencies
o Department of Trade and Industry (DTI)
o Department of Agriculture (DA)
o Department of Health( DOH)
o Department of Education (DepEd)

 Relevant Provisions
o Consumer Product Quality and Safety
o Deceptive, Unfair and Unconscionable Sales Acts and Practices
o Consumer Products and Service Warranties
o Labeling and Packaging
o Price Tag

 Deceptive Sales Acts and Practices

(Articles 50 and 51, RA 7394)

 Inducing a consumer to enter into sales, lease or avail of services

 Concealment
 False Representation
 Fraudulent Manipulation
 Generally, when an establishment lies to you or hides a material fact to
entice you to buy, he has committed a deceptive sales act
 CRIMINAL
(Article 60. Penalties)
a) Any person who shall violate the provisions of Title III, Chapter I, shall
upon conviction, be subject to a fine of not less than Five Hundred Pesos
(P500.00) but not more than Ten Thousand Pesos (P10,000.00) or imprisonment
of not less than five (5) months but not more than one (1) year or both, upon the
discretion of the court.
b) In addition to the penalty provided for in paragraph (1), the court may
grant an injunction restraining the conduct constituting the contravention of the
provisions of Articles 50 and 51 and/or actual damages and such other orders as
it thinks fit to redress injury to the person caused by such conduct.
 ADMINISTRATIVE
(Article 164. Sanctions)

 After investigation, any of the following administrative penalties may be

imposed even if not prayed for in the complaint:
- e) the imposition of administrative fines in such amount as
deemed reasonable by the Secretary, which shall in no case
be less that Five hundred pesos (P500.00) nor more than
Three hundred thousand pesos (P300,000.00) depending on
the gravity of the offense, and an additional fine of not more
than One thousand pesos (P1,000.00) or each day of
continuing violation

 Product Service and Warranty

(Chapter III, RA 7394)
 A contract whether expresses or implied between the buyer and the
seller of a consumer product or owner of a service firm concerning the
rights and obligations of both parties.
 Designation of Warranty
o Repair, replacement or refund
 Duration of Warranty
o Stipulation of seller and consumer on the period
o 60 days to 1 year following the sale of a new consumer products

 Application of Warranty

 Article 73. Penalties.

a) Any person who shall violate the provisions of Article 67 shall be
subject to fine of not less than Five hundred pesos (P500.00) but not more than
Five thousand pesos (P5,000.00) or an imprisonment of not less than three (3)
months but not more than two (2) years or both upon the discretion of the court.
A second conviction under this paragraph shall also carry with it the penalty or
revocation of his business permit and license.
b) Any person, natural or juridical, committing any of the illegal acts
provided for in Chapter III, except with respect to Article 67, shall be liable for a
fine of not less than One thousand pesos (P1,000.00) but not more than Fifty
thousand pesos (P50,000.00) or imprisonment for a period of at least one (1)
year but not more than five (5) years, or both, at the discretion of the court. The
imposition of any of the penalties herein provided is without prejudice to any
liability incurred under the warranty or guarantee.
 ADMINISTRATIVE
Article 164. Sanctions

 After investigation, any of the following administrative penalties may be

imposed even if not prayed for in the complaint:
- e) the imposition of administrative fines in such amount as
deemed reasonable by the Secretary, which shall in no case
be less that Five hundred pesos (P500.00) nor more than
Three hundred thousand pesos (P300,000.00) depending on
the gravity of the offense, and an additional fine of not more
than One thousand pesos (P1,000.00) or each day of
continuing violation.

 Labelling and Fair Packaging

(CHAPTER IV, RA 7394)

 Provides for the minimum labelling requirements of all consumer

products domestically sold, whether manufactured locally or imported

MINIMUM LABELLING REQUIREMENTS

CHAPTER IV, ARTICLE 77

• Registered trade name or brand name

• Registered trade mark
• Registered business name
• Address of the manufacturer, importer, repacker of the consumer product in the
Philippines
• General make or active ingredients
• Net quantity of contents
• Country of manufacture if imported
• If consumer product is manufactured, refilled or repacked under license from a
principal, the label shall state the fact
• Flammable or inflammable
• Direction for use
• Warning of toxicity
• Wattage, voltage or amperes
• Process of manufacture, if necessary

 Price Tag
ART 81-83, RA 7394

 All consumer products sold in retail shall bear an appropriate price tag,
label or marking indicating the price of the article.
 Consumer products shall not be sold at a price higher than that stated in
the price tag

 RA 7581 as amended by RA 10623 (Price Act)

 An Act providing protection to consumers by stabilizing the prices of basic

necessities and prime commodities and by prescribing measures against
undue price increases during emergency situations and like occasions.
 Implementing agencies
o Department of Trade and Industry (DTI)
o Department of Agriculture (DA)
o Department of Health( DOH)
o Department of Environment and Natural Resources (DENR)
o Department of Energy (DOE)
 Mandates IAs to issue Suggested Retail Prices (SRPs) of basic
necessities and prime commodities whenever necessary

 Lemon Law (RA 10642)

 An Act Strengthening Consumer Protection in the Purchase of Brand New

Motor Vehicles
  Implementing agency
o Department of Trade and Industry (DTI)
 Covers brand new motor vehicles that are to be in nonconformity with the
standards or specifications of the vehicle’s manufacturer or distributor
 Provides remedies through Mediation, Arbitration, Adjudication
 REPAIR, REPLACE, REFUND

 Toy and Game Safety Labelling Act of 2013 (RA10620)

 An Act Providing for Toy and Game Safety, Labelling, Appropriating Funds
Therefore
 Implementing agencies:
o Department of Health (DOH)
o Department of Trade and Industry (DTI)
 Provides for the labelling requirements of toys and games
 Treatment on Misbranded or Banned Hazardous Substance

SOCIAL IMPACT
 Joint DTI-DA-DOE Administrative Orders on Senior Citizens and Persons
with Disability
 Amendments to Joint DTI-DA Administrative Order (JAO) No. 02, Series
of 2008 entitled "Granting of Discounts to Persons with Disability on the
Purchase of Basic Necessities and Prime Commodities Pursuant to R.A.
No. 9442, otherwise known as the Magna Carta for Disabled Persons"
 WHEREAS, pursuant to Republic Act No. 9442 and its Implementing
Ruled and Regulations (IRR), to the extent possible, the government may
grant special discounts in special programs for persons with disability on
purchase of basic necessities

ENVIRONMENTAL IMPACT
 DTI Department Administrative Order No.17-08 S. 2017
 Implementing Guidelines on the Grant of Bagwis Award to Business
Establishments that Uphold Consumers’ Rights and Interest, and Practice
Business Ethics.
 Promotes the implementation of green measures among business
establishments as one of the parameter measures used in the
assessment of Bagwis-awardees.
  DTI Department Administrative Order No.17-08 S. 2017
 Toy and Game Safety Labelling Act of 2013 (RA10620)

SELF-CHECK

Multiple Choice
Choose the letter of the best answer.

1. It is an act that is one of the first pieces of legislation to protect consumer’s

rights, interests, and their general welfare.
a. Consumer Protection Act c. Magna Carta for Disabled Persons Act
b. Price Act d. Lemon Law

2. Under what article of the Republic Act 7394 does “Inducing a consumer to
enter into sales, lease or avail of services” being stated?
a. Article 60 c. Article 50 and 51
b. Article 164 d. Article 81 - 83

3. What do you call to a type of guarantee that a manufacturer or similar party

makes regarding the condition of its product to the buyer promising to repair or
replace it if necessary within a specified period of time?
a. Loyalty Card c. Official Receipts
b. Warranty d. All of these
4. What are the 3 R’s that are being stated in the chapter 3 of the Republic Act
7394?
a. Revise, Redo, Review
b. Repair, Replacement, Refund
c. Reduce, Reuse, Recycle
d. Repent, Repent, Repent

5. Provides for the minimum labelling requirements of all consumer products

domestically sold, whether manufactured locally or imported
a. Toy and Game Safety Labelling Act of 2013 (RA10620)
b. Price Act RA 7581 as amended by RA 10623
c. DTI Department Administrative Order No.17-08 S. 2017
d.) Labelling and Fair Packaging (CHAPTER IV, RA 7394)

6. How many days that is being mandated in the RA 7394 as the duration of
warranty?
a. 60 days – 1 year c. 60 days – 6 months
b. 30 days – 6 months d. 30 days – 1 year

7. It is an act which strengthening consumer protection in the purchase of brand

new motor vehicles
a. Price Act (RA 7581)
b. Consumer Act of the Philippines (RA 7394)
c. Toy and Game Safety Labelling Act of 2013 (RA10620)
d. Lemon Law (RA 10642)

8. It is an act that refers to the provision of protection to consumers by stabilizing

price of basic necessities and prime commodities.
a. Price Act (RA 7581)
b. Consumer Act of the Philippines (RA 7394)
c. Lemon Law (RA 10642)
d. Toy and Game Safety Labelling Act of 2013 (RA10620)

9. What is being mandated by the DTI to ensure reasonable price of basic

necessities and prime commodities.
a. Price Tag b. Price Elasticity c. Suggested Retail Price d. Price Ceiling
10. It is an act wherein the government may grant special discounts in special
programs for persons with disability on purchase of basic necessities for atleast
20%.
a. Consumer Act of the Philippines c. Toy and Game Safety Labelling Act
b. Price Act d. Magna Carta for Disabled Persons Act

Answer Key
1. A
2. C
3. B
4. B
5. D
6. A
7. D
8. A
9. C
10. D

References:
https://esmeloans.com/blog/consumer-protection-act-and-businesses
https://www.sec.gov.ph/wp-content/uploads/2019/11/2018_RTD_ON-
SUSTAINABILITY-REPORTING-INDICATORS.pdf

Information Sheet 4
PRINCIPLES OF CONSUMER

Learning Objectives:
After reading this information sheet, the students are expected to
a. identify the different principles of influence of consumer behavior
b. examine consumer behavior variables in relation yo product or service
purchase decision
c. relate the given principles to being a consumer
How do you get a person to buy a product or service? Psychology holds answers
to questions that have preoccupied marketing departments for decades,
particularly surrounding how to influence people and how people respond to
attempts to influence their behaviors.
Consumer behavior is the study of the dynamics of human behavior and how it
relates to the purchase decision. The course provides an in-depth view of the
many factors that influence the consumer’s decision-making process including
personality, social groups, culture, values structure, perception, and learning.
Society influence into six universal principles for understanding attempts to
influence human behavior. Both businesses and consumers can use these
principles to better understand the inner workings of purchasing behaviors and to
determine which strategies are most likely to succeed.

1. Reciprocity
 Humans often feel the need to return a favor or reciprocate kind gestures.
For consumers, this might mean offering a free sample or a generous
discount, for example.

2. Commitment.
 Once someone is engaged with something, they are more likely to stick
with it. In business, this means cultivating brand loyalty; once someone is
working with a product or using a service, they are more likely to commit
to paying for it again.

3. Pack mentality
 If more people do something, others are likely to do it as well. When
brands can demonstrate their popularity or satisfaction across a wide
customer base, other consumers are more likely to buy in as well.

4. Authority
 People are more likely to listen to an expert than anyone off the street. So,
while pack mentality is important, having a relevant expert speak to the
effectiveness of a brand's product or service is essential to converting new
consumers.

5. Liking
 People who are similar to the target consumer are more likely to persuade
the consumer to buy. People from similar demographics – whether in
terms of ethnicity, socioeconomic class, religious inclination or even
shared interests – are far more effective at persuading consumers than
those they perceive as vastly different.

6. Scarcity
  People tend to want what they perceive they cannot have. Making a
product or service seem exclusive or as if it will go out of stock if they don't
act quickly often makes it more enticing to the consumer and increases
the likelihood that they will buy in.
The psychological aspects of consumer behaviour are examined in order to
better understand your target market as consumers. Needs and motivation, risk
perception, group dynamics, attitudes, and the consumer decision-making
process are discussed. Armed with these six principles of influence, companies
can more adeptly navigate their potential consumers and convert more to sales.

SELF-CHECK

Multiple Choice
Choose the letter of the best answer.

1. What do you call to a study of the dynamics of human behavior and how it
relates to the purchase decision?
a. Consumer Rights c. Consumer Behaviour
b. Consumer Education d. Consumer Interest

2. What factor that influences the consumer’s decision-making process?

a. Personality c. Culture
b. Social Groups d. All of these

3. Both and consumers can use these principles to better

understand the inner workings of purchasing behaviors and to determine which
strategies are most likely to succeed.
a. Government c. Producers
b. Businesses d. All of these
4. What aspects of consumer behavior that being are examined in order to better
understand your target market as consumers
a. Psychological c. Psychosocial
b. Physiological d. Cultural

5. Once someone is engaged with something, they are more likely to stick with it
and in business it means cultivating brand loyalty. What principle is being
referred above?
a. Commitment b. Pack Mentality c. Reciprocity d. Authority
6. What principle of persuasion that tells humans often feel the need to return a
favor and kind gestures in which generous discounts to consumer is a good
example?
a. Commitment c. Reciprocity
b. Pack Mentality d. Authority

7. It is a principle in which people make decisions based upon the actions of

others, sometimes without even realizing it. When brands can demonstrate their
popularity or satisfaction across a wide customer base, other consumers are
more likely to buy in as well.
a. Commitment c. Reciprocity
b. Pack Mentality d. Authority

8. What principle said that people tend to want what they perceive they cannot
have?
a. Commitment c. Authority
b. Scarcity d. Liking

9. When brands can demonstrate their popularity or satisfaction across a wide

customer base, what will likely to happen to the consumer?
a. They are more likely to resell it as well
b. They are more likely to buy in as well
c. They will advertise it on social media by posting photos
d. They will make a copy of that product and sell it on a less price.

10. They are the one whom people are likely to listen regarding to the
effectiveness of a brand’s product or services?
a. Advertisers c. Commentators
b. Brand Ambassadors d. Experts

Answer key

1. C
2. D
3. B.
4. A
5. A
6. C
7. B
8. B
9. A
10. D

References:
https://www.nu.edu/ourprograms/college-of-professional-
studies/managementandmarketing/courses/mkt420/
https://www.businessnewsdaily.com/10151-how-to-influence-consumer-
decisions.html#:~:text=Consumer%20behavior%20is%20the%20study,%2C
%20authority%2C%20liking%20and%20scarcity.
https://www.niagaracollege.ca/parttimestudies/courses/MKTG/1221/

Information Sheet 5
KEEPING RECORDS AND MANAGING MONEY

Learning Objectives:
After reading this information sheet, the students are expected to:
a. discover the ways in keeping financial records
b. interpret the importance of keeping financial records and managing
money
c. develop the good practice of managing money
If saving money is important to you, record keeping should also be important to
you. Good records make it easy to follow your money and to keep track of tax
deductions. They provide you with the information you need to file a warranty or
insurance claim, and they help you stay on top of important tasks — like car
repairs and home maintenance. So, while you may hear more about the
importance of budgeting, make no mistake: solid record-keeping is just as
important to the frugal lifestyle. 
Many different systems for money management are possible. Whether a
particular system is the right one for you depends on you, your temperament,
and your situation. Descriptions of various systems follow. Remember that you
will still need to take any system and "customize" it to fit you.
This systems in record keeping is vital in regards to meeting the financial
commitments of the business and providing information on which decisions for
the future of the business can be based.

Envelope System
This system involves placing cash in envelopes or other containers marked for
each budget expense category. While this system is the simplest of the five
described, it has two disadvantages. First, keeping cash at home, even in a
home safe, has the potential for loss or theft. Second, it takes a lot of willpower
not to "rob" one envelope when another is empty. On the positive side, as money
is spent from each envelope, a running account of expenses can be noted on the
outside of the envelope. The envelopes also can be used to keep receipts.

Calendar System
Some people use a calendar to help manage their money. Use it to record dates
when bills are due or when payments need to be mailed to reach a creditor by
the due date. Also record when income is expected. By looking at the calendar
and comparing when money is available with bills that must be paid before
money is available again, decisions can be made about what bills to pay when.
Check the calendar daily to see if some financial management activity needs to
take place. Record other expenses on the calendar as money is spent.
Using a single calendar to track cash expenses will simplify the record keeping
system. The person in charge of record keeping will need only to consult the
calendar to account for what cash has been spent.
The calendar system adds a time dimension to a simple budget, resulting in a
record keeping system that shows not only how much is spent but when it is
spent.

Checkbook/Debit Card System

This system involves keeping accurate records in your checkbook transaction
record or register. It's a good system if you normally use a debit card or write
checks for just about everything. The only expenses you'll be missing are those
bought with cash or a credit card. If you note in the checkbook register or in a
separate notebook where cash goes, this system can be as complete as the
ledger system. It also means that expenses are recorded only one time rather
than being transferred to a ledger.
Some couples who choose to use the checkbook system provide for a "wild
check", a check which each person carries with them in case of emergencies. It's
easier than carrying the entire checkbook. This way you're never stuck needing
the checkbook when the other person has it. Single people may also find the
"wild check" idea helpful.
Discipline and consistency are required for this system, even though it is fairly
simple. Using it may help the house-hold unit develop cooperation. This system,
like all others, is only as good as the people using it and the information being
recorded.

Ledger System
This system involves using a ledger or book to record income and expenses. It is
the most detailed and creates the most accurate record.
This can also be a decreasing ledger system. In a decreasing ledger system,
monthly budget amounts are noted at the top of each column for the various
categories. As money is spent, it is debited against the "running total" in that
expense category. An advantage to this system is that you know immediately
how much money is left in each budget category. An advantage to this system is
that you know immediately how much money is left in each budget category.
The ledger system gives

 a more detailed as well as a total picture of cash flow,

 can be much more accurate,
  is a handy tax record, and
 results in records being all in one place.
But it does take time and effort, almost daily, and requires the cooperation of
everyone in the household.
A calendar may be used as part of either the checkbook of the ledger system. It
can be used to plan of record expenses or to plan due dates.

Home Computer Software Packages

A variation of the ledger system is using a microcomputer system to keep track of
household expenses and income. While it never makes sense to purchase a
microcomputer just to do household budgeting, if the computer is available in the
home for other purposes, then budgeting and recordkeeping is a natural.
The biggest advantages of using the microcomputer for household recordkeeping
are the large available storage space for keeping information and the fact that
mathematical computations can be done quicker and perhaps more accurately.
This system is expensive if bought only for record keeping. Another disadvantage
is that it still takes time and effort to do the record keeping.

Handling Petty Cash (Small Miscellaneous Expenses)

Petty cash is money spent and later you can't remember where it went. Maybe
it's that extra $5 you write into the check to buy groceries, or the refund money
you get when you use coupons or turn in bottles.
Is it important to keep track of petty cash? That depends on your situation. If
you're in a fairly tight situation, then you may think it important, even necessary,
to keep track of every dollar or even every penny. On the other hand, your
situation may be one that you really don't have to keep careful track of where the
money goes, but you choose to do so because you feel it's important to know.
The way you have more control of your spending.
One caution: remember something that's "petty" one day can add up to quite a
sum of money if that petty expense is a regular cash outlay for you. For example,
if you have two soft drinks per day out of a vending machine, you'll be spending
more than $200 over the course of a year.
If you decide to keep track, try using a small notebook you can carry with you.
Then, as soon as possible record your petty cash expenditures. Or write down
amounts on slips of paper such as receipts.
You may or may not decide to itemize your petty cash income and expenditures
in your accounting system. Again, that depends on your situation and you. One
category headed "petty cash" may be all of the detail you need.

Purchasing Practices
Consumer purchases refer to items used in daily living (e.g., clothing, food,
electronics, appliances). They are the purchases that most intimately frame your
life: you live with these items and use them every day. They are an expression
and a reflection of you, your tastes, and your lifestyle choices. Your spending
decisions reflect your priorities. Consumer purchases should fit into your budget.
By making an operating budget, you can plan to consume and to finance your
consumption without creating extra costs of borrowing. Purchasing decisions are
always limited by the income available, and that means making choices. Your
choices of what, where, when, and even how to buy will affect the amount that
you spend and the utility (the joy or regret) that you ultimately get out of your
purchase,

SELF-CHECK

Multiple Choice
Choose the letter of the best answer

1. It is the practice that makes it easy for us to follow our money and to keep
track of tax deductions
a. Online Banking c. Investing
b. Saving d. Record Keeping

2. What system that is being considered as the simplest among all in which cash
are being place in containers with a label of each budget category?
a. Envelope System c. Checkbook System
b. Calendar System d. Ledger System

3. What system of record-keeping where people use it to record dates when bills
are due or when payments need to be mailed to reach a creditor by the due
date?
a. Envelope System c. Checkbook System
b. Calendar System d. Ledger System

4. This system is the most detailed and takes the most accurate record all in one
place and it involves using record book of some sort to record income and
expenses.
a. Envelope System c. Checkbook System
b. Calendar System d. Ledger System

5. What do you call to a check which each person carries with them in case of
emergencies?
a. Bank Check c. Wild Check
b. Finance Check d. Both A and B

6. It is considered a good system when people normally use a debit card or write
checks for just about everything
a. Envelope System c. Checkbook System
b. Calendar System d. Ledger System

7. is money spent and later you can't remember where it went.

a. Cash on Hand c. E-cash
b. Petty Cash d. Loan

8. This refers to the item/s that most intimately frame your life, live with these
items and use them every day.
a. Consumer Purchases c. Profit
b. Income d. Bank Account

9. What system that is being used as a variation of the ledger system to keep
track of household expenses and income?
a. Petty Cash c. Home Computer Software Packages
b. Microcomputer System d. Both B and C

10. If money is important to you, record keeping should also be

important to you.
a. Saving c. Income
b. Online Selling d. Profit

Answer key

1. D
2. A
3. B
4. D
5. C
6. C
7. B
8. A
9. B
10. A

References:
https://extensionpublications.unl.edu/assets/pdf/g1926.pdf
http://www.financial-library.com/recordkeeping.html
https://www.thebalanceeveryday.com/keep-better-records-1389011
https://www.ajml.com.au/downloads/resource-centre/references/operational-
management/The%20importance%20of%20record%20keeping.pdf

Information Sheet 6
MONEY MANAGEMENT

Learning Objectives:
After reading this information sheet, the students are expected to:
a. outline the idea of money management
b. explain the different ways of managing money
c. value the importance of money management
Money management refers to the process of tracking and planning an individual
or group’s use of capital. In personal and corporate finance, money management
usually includes budgeting, spending, saving, and investing.
Money management is a broad concept. It refers to the strategies and techniques
to determine the use of an individual, company, or institution’s capital. In
personal finance, money management covers budgeting, spending, and saving
(investing). Money management can be proactive with periodic or regular
financial planning. It can also be reactive to specific events without intuitive
planning in advance.
Learning how to effectively manage your money can reduce your stress and
allow you to achieve more of your long-term goals, like getting out of debt or
saving for retirement. Here are some steps you can take to build better money
management skills.

How To Manage Your Money Better

1. Have a Budget
 Many people don’t budget because they don’t want to go through what
they think will be a boring process of listing out expenses, adding up
numbers, and making sure everything lines up. If you’re bad with money,
you don’t have room for excuses with budgeting. If all it takes to get your
spending on track is a few hours working a budget each month, why
wouldn’t you do it? Instead of focusing on the process of creating a
budget, focus on the value that budgeting will bring to your life.

2. Using the Budget

 Your budget is useless if you make it then let it collect dust in a folder
tucked away in your bookshelf or file cabinet. Refer to it often throughout
the month to help guide your spending decisions. Update it as you pay
bills and spend on other monthly expenses. At any given time during the
month, you should have an idea of how much money you’re able to spend,
considering any expenses you have left to pay.

3. Give Yourself A Limit For Unbudgeted Spending

 A critical part of your budget is the net income or the amount of money left
after you subtract your expenses from your income. If you have any
money left over, you can use it for fun and entertainment, but only up to a
certain amount. You can’t go crazy with this money, especially if it’s not a
lot of it has to last the entire month. Before you make any big purchases,
make sure it won’t interfere with anything else you have planned.
4. Track Your Spending

 Small purchases here and there add up quickly, and before you know it,
you’ve overspent your budget. Start tracking your spending to discover
places where you may be unknowingly overspending. Save your receipts
and write your purchases in a spending journal, categorizing them so you
can identify areas where you have a hard time keeping your spending in
check.

5. Don’t Commit to Any New Recurring Monthly Bills

 Just because your income and credit qualify you for a certain loan, doesn’t
mean you should take it. Many people naively think the bank wouldn’t
approve them for a credit card or loan they can’t afford. The bank only
knows your income, as you’ve reported, and the debt obligations included
on your credit report, not any other obligations that could prevent you from
making your payments on time. It’s up to you to decide whether a monthly
payment is affordable based on your income and other monthly
obligations.
6. Make Sure You’re Paying the Best Prices

 You can make the most of your money comparison shopping, ensuring
that you’re paying the lowest prices for products and services. Look for
discounts, coupons, and cheaper alternatives whenever you can.
7. Save Up for Big Purchases

 The ability to delay gratification will go along way in helping you be better
with money. When you put off large purchases, rather than sacrificing
more important essentials or putting the purchase on a credit card, you
give yourself time to evaluate whether the purchase is necessary and
even more time to compare prices. By saving up rather than using credit,
you avoid paying interest on the purchase.6 And if you save rather than
skipping bills or obligations, well, you don’t have to deal with the many
consequences of missing those bills.
8. Limit Your Credit Card Purchases

 Credit cards are a bad spender's worst enemy. When you run out of cash,
you simply turn to your credit cards without considering whether you can
afford to pay the balance. Resist the urge to use your credit cards for
purchases you can’t afford, especially on items you don’t really need.
9. Contribute to Savings Regularly

 Depositing money into a savings account each month can help you build
healthy financial habits. You can even set it up, so the money is
automatically transferred from your checking account to your savings
account. That way, you don’t have to remember to make the transfer.
10. Being Good With Money Takes Practice

 In the beginning, you may not be used to planning ahead and putting off
purchases until you can afford them. The more you make these habits part
of your daily life, the easier it is to manage your money, and the better off
your finances will be.

SELF-CHECK
Y6

Multiple Choice
Choose the letter of the best answer

1. It refers to the process of tracking and planning an individual or group’s use of

capital
a. Financing c. Record Keeping
b. Money Management d. Budgeting

2. In personal and corporate finance, money management usually includes

.
a. Budgeting c. Saving
b. Spending d. All of these

3. What is being updated as you pay bills and spend on other monthly
expenses?
a. Profit c. Budget
b. Expenses d. Income

4. It is a critical part of your budget where you can use it to other things that are
not part of the entire budget.
a. Net Income c. Expenses
b. Profit d. Savings

5. What do you call to the ability that will go along way in helping you be better
with money?
a. Saving c. Delay Gratification
b. Investing d. Both B and C

6. It is a good practice of managing money where it can help you build healthy
financial habits.
a. Depositing money into savings account
b. Applying for a loan
b. Investing your money
d. All of the above

7. What is being considered as the worst enemy of the bad spender?

a. Net Income c. Debit Card
b. E-money d. Credit Card

8. What do you call to the thing that people should refer to it often throughout the
month to help as guide to their spending decisions?
a. Discounts c. Budget
b. Bank Statements d. Credit Score

9. Most credit cards make people end up having if he is not good at

budgeting and spending.
a. Debt c. Loans
b. Too Much Purchase d. Net Loss
10. It is good to look for these to ensure you’re paying the lowest price of
products.
a. Friend’s Business c. Discounts
b. Free Items d. Installments

Answer key

1. B
2. D
3. C
4. A
5. D
6. A
7. D
8. C
9. A
10. C

References:
https://corporatefinanceinstitute.com/resources/knowledge/finance/money-
management/
https://www.thebalance.com/ways-to-be-better-with-money-960664
https://www.freedomdebtrelief.com/blog/money-management-skills/