1.1.5

Question 1

Barter

Answer 1

The swapping of one good for another without the use of money

Question 2

Market

Answer 2

Any convenient set of arrangements by which buyers and sellers communicate to exchange goods and services

Question 3

Money

Answer 3

An item which fulfils four functions - a medium of exchange, a store of value, a unit of account, and a method of deferred payment

Question 4

Money substitutes

Answer 4

Anything that is a medium of exchange but not a store of value eg. a credit card

Question 5

Sub-market

Answer 5

A market which is a distinct and identifiable part of a larger market

Question 6

Specialisation

Answer 6

Where economic agents (either individually or collectively) are not self-sufficient but concentrate on producing a certain good or service or narrow range, and trade the surplus with others

Question 7

Division of labour

Answer 7

Specialisation by workers who perform different tasks at different stages of production to make a good or service in cooperation with others

Question 8

Primary sector

Answer 8

Extractive and agricultural industries

Question 9

Private sector

Answer 9

The part of the economy owned by individuals, companies, and charities

Question 10

Public sector

Answer 10

The part of the economy where production is organised by the state or government

Question 11

Secondary sector

Answer 11

Industries involved in the production of goods - mainly manufacturing

Question 12

Tertiary sector

Answer 12

Industries involved in the production of services

Question 13

Quaternary sector

Answer 13

That part of the economy involved with services such as research information and technology

Question 14

Capital productivity

Answer 14

Output per unit of capital employed

Question 15

Labour productivity

Answer 15

Output per worker

Question 16

Globalisation

Answer 16

The process by which economies have become increasingly integrated and inter-dependent

Question 17

Cash

Answer 17

Notes and coins - token money with little intrinsic value

Question 18

Liquidity

Answer 18

The ease with which something can be converted into money without loss of value

Question 19

Medium of exchange

Answer 19

Any asset widely accepted as a medium of exchange. It facilitates transactions

Question 20

Unit of account

Answer 20

Money is a measure used to value or cost products

Question 21

Method of deferred payments

Answer 21

An accepted way to settle a debt.

Question 22

Store of value

Answer 22

An asset that holds it value over time. Allows saving and delayed consumption.