explain the various reasons for exploitation of consumers ? 4 marks
Answers
(WRITE THIS AS INTRODUCTION)
Exploitation in
the marketplace happens in various ways. Markets do not work in a fair manner when producers are few and powerful whereas consumers purchase in small amounts and are scattered. This happens especially when large companies are producing these goods. these companies with huge wealth, power and reach can manipulate the market in various ways. at times false information is passed on through the media, and other sources to attract consumers.
(POINTS - )
There are many factors that causing exploitation of consumers. They are as follows -
1. LIMITED INFORMATION -
Accurate information about a particular product is not given to the consumers. This leads to consumer exploitation. For example - Giving only the advantages of a product. This will make consumers get attracted to the product and thus they buy it without knowing whether it has any side effects or not.
2. LIMITED SUPPLIES -
This include BLACK MARKETING / HOARDING. Producers stores some products and sells the rest. When the demand for the product increases, they will increase its price and then sell the stored products. For example - Selling rice, sugar etc.
3. LIMITED COMPETITION -
If there is no competition between producers and if their product is unique, they will sell their product at a very high price. For example - Products of branded companies.
4. ILLETERACY -
The illeterate people will not know about what are the malpractises going on around them, and hence they are being exploited by the producers. For example - If a consumer dosen't know about black marketing or hoarding, he or she will buy the product for whatever price the producers are asking for.
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