Personal Finance - Chapter 7 Buying Decisions & Credit Unit Essential Question: Why do we use credit to make purchases? Why do we use credit to make purchases?

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Presentation transcript:

Personal Finance - Chapter 7 Buying Decisions & Credit Unit Essential Question: Why do we use credit to make purchases? Why do we use credit to make purchases?

Buying Plans Essential Questions: Essential Questions: How does using a buying plan make us smarter consumers? How does using a buying plan make us smarter consumers? What are the steps in a buying plan? What are the steps in a buying plan? What criteria should be used to choose one item over another? What criteria should be used to choose one item over another? Why does comparison shopping lead to better buying decisions? Why does comparison shopping lead to better buying decisions?

Vocabulary Impulse Buying Impulse Buying Wants Wants Needs Needs Criteria Criteria Spending Limits Spending Limits Rebate Rebate Timeline Timeline

Sources and Benefits of Credit Essential Questions: Essential Questions: What are the purposes of credit? What are the purposes of credit? What are some sources of consumer credit? What are some sources of consumer credit? How do you complete a credit application? How do you complete a credit application? What are the benefits of using credit? What are the benefits of using credit?

Vocabulary Credit Credit Service Credit Service Credit Revolving credit Revolving credit Store accounts Store accounts Installment credit Installment credit Collateral Collateral Line of credit Line of credit

Cost of Credit Essential Questions: Essential Questions: What are the costs associated with using credit? What are the costs associated with using credit? What is the difference between fixed and variable interest rates? What is the difference between fixed and variable interest rates? What are three methods of computing finance charges? What are three methods of computing finance charges? What penalties and fees can be imposed by credit card companies? What penalties and fees can be imposed by credit card companies? Why should you compare credit card offers? Why should you compare credit card offers?

Vocabulary Fixed rate Fixed rate Variable rate Variable rate Adjusted balance method Adjusted balance method Previous balance method Previous balance method Average daily balance method Average daily balance method Penalty Penalty Over-the-limit fee Over-the-limit fee