|
USING CREDIT WISELY
Article 1 - Part 2
Provided by Aquila Business Services, LLC
TIMES HAVE CHANGED
Today more Americans live in cities or towns than on farms. Instead of being self-sufficient as our farming ancestors were, we have come to depend on each other as we each work in a specialized way to produce and distribute goods and services for the public. Instead of income being linked to the harvest, most workers are now paid at regular intervals - weekly, twice a month, or once a month.
The interdependence and the fact that most people now have a regular income has made us a nation of consumers. In economic terms, a consumer is someone who buys or uses goods or services which someone else has produced.
The use of consumer credit is important to the nation's system of capitalism and free enterprise for these reasons:
- Because consumer credit is widely available, manufacturers know that a large number of consumers will be able to buy what is produced.
- Because they are sure of a market, manufacturers can produce in large quantities (mass produce) with the expectation there will be a sufficient demand for the product.
- Because of mass production, individual items or services cost less than they would if they were produced in smaller quantities. In business terms, this savings is referred to as achieving low unit cost. Achieving low unit cost is important because it allows more Americans of moderate means to buy what only the wealthy could once afford.
- Because goods and services are produced at low unit cost and are therefore affordable to most consumers, America has the world's highest standard of living. That means a larger number of us are well fed, clothed, and housed; have a high level of health and education; and can afford luxuries to bring added satisfaction into our lives.
- As people moved into the cities and as women have entered into the work force, there has been an increased demand for services which families once provided for themselves. In response to changing consumer needs, companies specializing in services took advantage of the opportunity to create new services. Some examples of such services are fast food restaurants, convenience sores, child care centers, and walk-in medical offices.
Stay tuned for updates on this article!
|
|
|
