What Is Consumer Education? - Definition & Importance

What Is Consumer Education? - Definition & Importance
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  • 0:00 Consumer Rights
  • 0:35 Consumers
  • 1:48 Business
  • 2:23 Government
  • 3:17 Lesson Summary
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Lesson Transcript
Instructor: Shicara Hollie

Shicara has a Master Degree in Business Administration with a focus in Marketing

We will discuss consumer education and the responsibilities of businesses and the government. Test your knowledge with a quiz at the end of the lesson.

Consumer Rights

What is consumer education? Consumer education is a right that protects the consumer from large companies that sell products and services. According to the consumer rights bill that was established during President John F. Kennedy's term, consumers have the right to know more about the products that they purchase. In addition, consumers have the right to be protected from malicious acts. Consumer education provides resources and information that inform the consumer of such things as price and trade practices. Consumer education involves three parts: Consumer, Business, and Government.

Consumers

Consumer education is pivotal within the buying society. Consumers are informed on how to make better buying decisions that directly affect the functioning of the economy. Consumer education has become more relevant due to the rapid growth of products in the market. Consumers need to stay informed on the effects of the economy in order to make the best decisions.

A recent example of consumer education was during the recession that hit the Unites States between 2009 and 2011. The recession had an effect on the economy as a whole. Thousands of people lost their jobs and homes and families had to make immediate financial decisions. They were forced to implement strict budgets and reduce their spending tremendously. With less money being circulated into the market and economy it made a difference in business growth and created a downward spiral.

It was important that consumers were educated and given information by the government, media, and businesses. Consumers needed to know how businesses were doing in order to determine how to invest their money and they also they needed to know where to look for employment. Things such as monthly/quarterly financial reports from corporations were important so that consumers were given a realistic view of company performance.

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