Activity 2: Choosing credit (Commerce)
1. PLAY the video segment
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In the video, Sophie and Tye are interviewing Nik as a potential housemate.
Nik is amazed that the 'interview' is short and Tye and Sophie only ask if he has a job (and some money). |
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So, after meeting with your friends and shopping around, you've decided that you still need to buy the following items for your share house:
- A fridge (about $800)
- A kitchen table (about $300)
- A lounge and chairs for the lounge room (about $600)
As you don't have the cash, you've decided to apply for a credit card. Before you complete this worksheet, think about the your likely income and savings.
To avoid paying more interest than you need to, find out if the interest is charged from the date you made the purchase, the date of the monthly statement or from the date the statement is due.
2. CHOOSE from the options below. Will you:
• Pay off your balance in full every month and not take cash advances? If so, you should look for an interest free period and compare the cost of annual fees.
• Occasionally have an unpaid balance at the end of the month? You should look for a card with a low interest rate, an interest free period and a method of calculating interest from the date on which the account payment is due.
• Usually have an outstanding balance at the end of the month and use the card for cash advances? You should look for a card with a lowest interest rate.
3. Now COMPARE the cards of various credit providers, answering the questions below:
a. Who will provide this type of card?
b. How would you have to apply for it?
c. Are there any application fees?
d. What are the terms and conditions?
e. What is the interest rate charged on the card?
f. Are their any additional fees or benefits?
g. How widely is the card accepted?
h. Does the card have a PIN?
i. Does the credit provider offer any guarantees?
4. RESEARCH the Just the Facts - Credit section of this website. Find out as much as you can about what to look for when choosing credit.
5. COMPARE your answers with others in your class.
This activity can be found in the NSW Money Stuff Teacher resource book– Commerce page 36.
Explore additional learning activities (which include extension and revision tasks) in the print resources section under Print resources - Victoria.
Linked Learning Outcomes - NSW
Core Part 1.2 Personal Finance
Focus: Students develop knowledge, understanding and skills that assist them to achieve financial independence by developing the ability to make informed judgements and to take effective decisions regarding the use and management of money.
Students learn about: Borrowing money.
Outcome LS.9:
Students learn about: Exercising care when accessing financial services.
Learning Outcomes – Victoria
Victorian Essential Learning Standards (VELS) Discipline-based learning
Domain: The Humanities - Economics
Dimension: Economic knowledge and understanding
Level 5
Students explain the nature of the economic problem and how economic choices involve trade-offs that have both immediate and future consequences.
Students make informed economic and consumer decisions, demonstrating the development of personal financial literacy.
Level 6
Students discuss and explain what it means to be an ethical consumer and producer and identify examples of ways values can affect the economic decision making of consumers, producers and governments.
Students explain the role and significance of savings and investments for individuals and for the economy, and demonstrate the skills required to successfully plan and manage personal finances.
Learning Outcomes - Western Australia
(Society & Environment)
NSS 2.3 Understand that groups and communities obtain goods and services to meet their needs and wants.
NSS 6.3 Understands that people affect, and are affected by, changes to interrelationships and elements in economic systems.