Budget & Trade Flashcards
Define: revenue.
The money that is coming in to the government; the income a government receives. The most revenue comes from the individuals income tax.
Define: calendar year
The one year period from January 1 to December 31.
Define: financial year.
An accounting period that goes for 12 consecutive months. In Australia, from July 1 to June 30.
Define: Budget
The anticipated value of revenue and expenditure for the Federal government for the next financial year. It is prepared by the Treasurer.
Treasurer?
The Honourable Scott Morrison MP - Liberal
Define: deficit
When the expenditure exceeds the revenue.
Define: surplus
When the revenue exceeds the expenditure.
Types of revenue?
Individuals income tax, superannuation tax, company and resource rent tax, fringe benefits tax, customs duty, non-tax revenue, sales tax, fuels excise, other tax and excises.
Types of expenditure?
Education, general public services, defence, health, social security and welfare, and other functions and purposes.
Changes to our budget?
As our expenditures have increased from last year, exceeding the revenue, welfare has tightened. Therefore low income earners may be affected. Encouragement of small businesses, so as to provide more jobs, has been done through dropping tax rates.
Define: trade
The exchange of goods and services between nations. People have been trading for thousands of years.
Define: imports
Goods and services purchased from an overseas seller and sold in the Australian market. These are purchased as we do not produce them efficiently or effectively.
Define: exports
Goods and services produced in Australia and purchased by overseas countries. Australia is full of natural resources that are not as abundant in other counties.
Who does Australia export to and what?
Japan, China, Korea, India, USA.
Coal, iron ore, gold, education.
Who does Australia import from and what?
China, USA, Japan, Singapore.
Petrol, cars, gold, medicines.
Define: multinational companies.
Organisations that operate in more than one country. Their head office is based in one country but they have branches in other countries. Eg. Microsoft, KFC, Coca-Cola, McDonalds.
Reasons for growth of multinational companies?
- Economical to establish business in other countries as there may be cheaper manufacturing costs, due to low labour rates.
- Rapid advances in technology, have gained multinationals substantial market share.
- Economies of scale-ability to reduce ‘per unit’ price of a product due to increased production rates.
- Produced a product that is popular with consumers all over the world.
Define: tariff
A tax on imported goods. These are implemented to protect producers. As tariffs make imports more expensive, importing goods is then discouraged.
Define: expenditure
The money the government spends. This year, the area of most expenditure was social security and welfare.
