TERM 3 ECONOMICS
KEY CONCEPTS
Economics - the study of production (making), distribution (giving out) and consumption (using) of goods and services.
Interdependence - the way we rely on others to satisfy our needs and wants. we can describe this through the circular flow. individuals give businesses expenditures and labour, in return they receive goods and services and income.
Specialisation & Trade - Trade refers to how other countries importing/ exporting goods and service. specialisation is how a business, individual or country focuses on the production of the certain good or services.
Allocations & Markets - markets is how we distribute (allocate) goods and services between buyers and sellers. the market is mainly run by the idea of supply and demand.
Making Choices - refers to how we decide what to spend our limited resources on. these are known as consumer decisions. in addition to consumer decisions people must also make:
business decisions- produce
employment choices - work
legal choices - if you should take action over a faulty product
Economic Performance &Living Standards - economic performance is how economists measure how well an economy is doing, some key factors of this are gross domestic production (GDP), inflation and unemployment rate. living standards also contribute to economic performance non materialistic standards refer to how happy the population is this data is collected via surveys. materialistic standards are the access people have to goods and services and how well their needs and wants are satisfied.
Scarcity -the economic problem of having unlimited needs and wants but limited resources. for example; water, land and sugar.
the four factors of production are;
Capital - manufactured resources such as equipment
Enterprise - management skills that bring the other factors together and create businesses.
Land - the natural resources
Labour - workers
KEY VOCABULARY
5 ECONOMIC SYSTEM
TRADITIONAL
PLANNED CAPITALIST
MARKET CAPITALIST
PLANNED SOCIALIST
MARKET SOCIALIST
4 SECTORS ECONOMY
PRIMARY
SECONDARY
TERTIARY
QUARTERNARY
ECONOMICS
GOODS
SERVICES
PRODUCERS
CONSUMERS
NEEDS
WANTS
OPPORTUNITY COST
Globalisation
definition
why it's important
transnational corporations
spending/ investments
Wants are goods or services that are desired/ unnecessary.
people that use goods/ services
skills, expertise offered by others - intangible
a branch of HASS that studies the production, distribution and consumption of goods and services.
things people want/ need they are tangible
individuals/ businesses that make goods and services
goods/ services that are required
the real economic cost of a decision. the price of the good/service you didn't use or buy.
Scams
it relies on costumes, history, and time- honoured beliefs, these societies depend on; agriculture, fishing, hunting, etc. they barter instead of using money
consists of a mixture of public ownership of the means of production, coordination of production and distribution of production through state planning
a system in which private individuals or businesses own capital goods. production of goods/services is based off of market
individuals and firms own the productive resources but government decides the what to produce? how to produce? whom to produce for?
the productive resources are owned by government but individuals and firms decide the 3 economic questions
raw materials: -agriculture - mining - fishing
manufacturing turns raw materials into goods
are the selling/ services department
the research and development sector
how the world is increasingly interconnected
corporations that operate over multiple nations
it allows us to get things that we wouldn't have been able to produce in our own country, like cars, also to earn more income from other countries and communicate with family and friends overseas.
Australian globalisation
trade with other countries. foreign direct investment ($$ from other countries directly). Australians work overseas and others work in Australia. tech- quickly and efficiently talk with costumers all over the world. migration - settlers in Australia
why people overspend.
investment options
market and advertising
credit availability
social power and prestige
impulse buying
keeping up with the Jonses'
pursuit of happiness
wanting what others have
cars, clothes and houses can contribute to our societal standing
clever marketing convinces us we need a range of things
they have access to credit and don't think about having to pay later
some make a quick purchase without thinking about
people think the more they buy the happier they'll be
equities/ shares
property
interest-earning investments
superannuation
getting money from deposits to a bank, government or company
unit of ownership in a company
buying a property cheap renovating it and then selling it or renting it out
a form of saving money for retirement
definition
emotional
investment/ online
victims
scams are traps to dishonestly take someone's money
phishing - emails sent from"bank" asking for account details. send out 1,000's of emails
account problem - call from scammer saying there's a problem with your account. they will ask for your account details
how to protect yourself
charity - scammer will pose as a genuine charity to take donations
romance - scammer takes advantage of people looking for love. they will usually take photos form thee internet and use them to set up fake accounts on dating sites
psychic - victim is told they will have trouble in the future if they don't buy a certain lucky charm or pay a fee for a "spell"
scammers will aim for people who are vulnerable this means people who are perhaps lonely, not good with technology (this can be elderly people)
be suspicious
be alert
be patient
be wise
be cautious
be aware that others may not be honest in their dealings with you
don't give strangers your money, credit card or bank account details
don't be pressured into doing something quickly, get a second opinion
check bank and credit card statements for unexplained transactions
understand that there is little chance of getting rich quickly from a business scheme