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Economics and Business Term 4 Imogen Anderson - Coggle Diagram
Economics and Business
Term 4
Imogen Anderson
Key concepts
Scarcity
Definition
Is the economic problem of having unlimited wants and needs but limited resources available.
Making Choices
Definition
Consumers make decisions based on what they think is best for them. Every decision involves an opportunity cost.
Specialisation and Trade
Definition
Many countries around the world are unable to produce the variety of needs and wants the population requires, so they trade with other countries that specialise in the making of certain products.
Interdependence
Definition
Refers to the way we rely on others to satisfy our needs and wants.
Allocation and Markets
Definition
Refers to the way we distribute our scarce resources among produce. It can also refer to the way we then distribute scarce goods or services amount consumers.
Economic Performance and Living Standards
Definition
Economists measure how well an economy is doing , this is known as it's economic performance. Economists also measure living standards. Living standards can be material or non-material.
Markets
4 types of Markets
Stock Market
Example
Definition
Where shares in Australian companies are brought and sold.
Labour Market
Definition
Where workers sell their skills in return for knowledge and effort to employers.
Example
The housing market
Definition
Where houses are brought and sold.
Example
Foreign Market
Definition
Where different currencies from around the world are brought and sold.
Example
You purchase 100,000 euros at the EUR/USD exchange rate of 1.5000. This means it costs 1.5 U.S. dollars to purchase 1 euro.
Graphs
Supply
The amount a business is willing to make
Demand
The amount consumers are willing to buy at a certain price
Equilibrium
The amount both supply and demand are equal
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Consumer rights and responsibilities
Rights
Consumer protection is the practice of safeguarding buyers of goods and services, and the public, against unfair practices in the marketplace
Responsibilities
Consumer responsibility is taking personal responsibility for the environmental costs and consequences of what you purchase and use.
Types of businesses
Sole traders
Sole Proprietorship: The simplest type of business. Sole proprietorships are owned and operated by a single person and are very easy to set up.
Partnerships
Partnership. Partnerships are made up of 2 or more people who distribute income or losses between themselves
Coorperation
Corporations are companies that have been authorized to act as single entities.
Company
An association of people, whether natural, legal or a mixture of both, with a specific objective. Company members share a common purpose and unite to achieve specific, declared goals.
Franchise :
Franchises must strictly follow the set guidelines of the main corporation. Most entrepreneurs have resulted in franchising since it's a good way of expanding
Needs and wants
Need
Is something that you require to have or you wont survive
Want
Can like without and won't die
Goods and services
Good
Something that you given but is also tangible
Services
Something that you use that isn't tangible
