Consumer Studies Grade 11 Term 3 Week 4 - 2020

Directorate: Curriculum FET
SUBJECT and GRADE CONSUMER STUDIES: Grade 11

TERM 3 Week 4
TOPIC The Consumer
AIMS OF LESSON Learners must be able to:
• List hints to keep bank charges down
• list the methods of purchasing goods
• explain the advantages and disadvantages of cash transactions
• explain the advantages and disadvantages of credit transactions (lay-buy, credit account,
credit card)
• compare credit and cash transactions
RESOURCES Paper based resources Digital resources

Textbook: Successful: p.25-37 Refer to the relevant digital resources e.g. links on
Focus: p. 26-39 the WCED ePortal PP grade 11, term 3, week 4
https://www.youtube.com/watch?v=Vyheek2FqL4
See notes included below. https://www.youtube.com/watch?v=T3wxogO1nYU
https://www.youtube.com/watch?v=YnVDNeclMI8
INTRODUCTION • Ways of purchasing would have been dealt with in EMS in grade 7-9
• In term 1 you dealt with drawing up a spending plan according to your income and
expenses. Now you will learn the different ways to use your money effectively and how you
can make various payments.
• As technology has changed so has banking and payment methods.
CONCEPTS AND SKILLS • Banking consists of various facets, it’s a place to CAN YOU?
save money and a place to borrow money from.
We use different types of banking transactions as 1. Explain the advantages and
a means to pay for our goods and services. disadvantages of cash and credit
transactions.
• The cost of using credit is high and so you need to 2. Explain how to keep bank
choose the transactions that are going to be the charges down as much as
most affordable for your needs. possible
• There are two classifications for ways of
purchasing goods: either by means of cash or Terminology you should know.
credit. • Interest/interest rate
Both of these ways have advantages and • Cash transactions
disadvantages. • Credit transactions
• Credit
• Debit
ACTIVITIES/ASSESSMENT Complete the following questions.
1. Compare a debit card and a credit card as a means of payment.

2. Explain the difference of using a store card as opposed to a credit card.
3. List different forms of cash transactions
4. Name the main differences between credit card and debit card payments.
5. Click on the link to access PPT on payment methods.
https://drive.google.com/file/d/1_Rrtc6IfCssnE8Lyq7yVLedi2Lre9CgJ/view?usp=sharing
CONSOLIDATION • The next section will look at the technology that we can use for payments and the
advantages and disadvantages of each.
VALUES It is very important to try and live within your means.
Try and use your money as wisely as possible to meet your needs and then your aspirations.
WAYS TO REDUCE BANKING CHARGES
• Use a cheque card, credit card or debit card instead of cash to pay for the
purchase as it is safer, cheaper, and more convenient.
• Use ATM, telephone, or cell phone banking, or online(internet) banking rather
than going into a bank branch.
• Use the ATMs of your bank as additional fees apply when using other bank’s
ATMs.
• Make fewer withdrawals of larger amounts rather than withdrawing small
amounts often.
• Make sure there is enough money in your account to cover all your transactions
to avoid penalty fees
The comparison of cash and credit transactions
CASH TRANSACTIONS CREDIT TRANSACTIONS

Purchases are dependent on the amount Purchases are not dependent on the
of cash that the customer has available. amount of available cash that the
customer has.
The customer does not incur any The customer pays interest when using
additional costs when paying cash. credit
Customers can negotiate a discount Selling prices are increased to cover the
when paying cash. cost of offering credit
Cash can be lost or stolen The customer does not have to carry
cash when shopping.
A record must be kept of purchases so The statement of account is an accurate
that consumers know what the money record of all credit.
was used for.
The customer will never incur debt. It is easy for the customer to spend more
than he/she can afford to pay back.
Saving to pay cash will delay purchases. Credit makes it possible to obtain goods
and services immediately
The interest rate paid on savings and Finance charges for credit is high
investments is low.
METHODS OF PURCHASING GOODS AND SERVICES
CASH TRANSACTIONS:
ADVANTAGES DISADVANTAGES
➢ You are free to shop anywhere and not ➢ Carrying large amounts of cash can be
only at shops that offer credit. unsafe
➢ You can bargain and ask for a cash ➢ You need to be disciplined about
discount. keeping track of your expenses.
➢ You think twice before making a ➢ Some shops are unwilling to refund cash
purchase as you need to hand your for returns.
cash over. ➢ You may receive preference at a shop
➢ You can save your credit for where you have an account.
emergencies. ➢ When you use cash, you do not build up
➢ Less admin as you do not need to check a credit record.
your accounts. ➢ Most cash stores do not deliver.
➢ Cash is ideal for small purchases. ➢ If cash is lost it cannot be replaced.
➢ It is convenient for people who don’t ➢ A small business is vulnerable, especially
have bank accounts. when money is carried to the bank to be
➢ Paying cash minimizes the seller’s risk of deposited.
bad debt from customers not paying ➢ It is difficult to prove payment.
accounts.
CREDIT TRANSACTIONS
TYPE OF ADVANTAGES DISADVANTAGES
TRANSACTION
Lay-buy ➢ The goods are kept for the ➢ The goods may not be kept
customer until the last payments safe or may have been
have been made. damaged by the time the last
➢ Interest is not usually charged for payment has been made.
this service. ➢ It is difficult to prove how many
➢ It is convenient for people who payments have been made,
do not have access to credit or especially if cash has been
bank accounts. used.
➢ Problems arise if all the
payments cannot be made.
Monthly store card ➢ Some stores allow customers to ➢ It is easy to overspend.
buy goods on credit up to a ➢ When you want to make a
specific limit depending on their purchase it’s more difficult to
creditworthiness. shop around, therefore you
➢ The customer takes the goods. have a limited choice.
➢ At the end of the month, he or
she receives a statement of
account reflecting the total
amount owing and the minimum
that must be paid.
Credit card ➢ Businesses are guaranteed ➢ The bank deducts a
payment. percentage of the purchase
➢ Credit cards can be used for amount before paying the
mail-order or online purchases. business.
➢ The card holder can use budget ➢ High interest rates are
facilities on the credit card and charged, making credit cards
pay the amount to the bank in an expensive way to borrow
instalments. money.

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Directorate: Curriculum FET

SUBJECT and GRADE CONSUMER STUDIES: Grade 11

RESOURCES Paper based resources Digital resources

1. Compare a debit card and a credit card as a means of payment.

The comparison of cash and credit transactions

CASH TRANSACTIONS CREDIT TRANSACTIONS

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