Commerce Flashcards
Primary need
Things essential to life
Secondary needs
Wants
What are the four main types of economies
Subsistence, planned, market capitalist, market socialist
Subsistence
An economy which is controlled by the market. People only produce what THEY want. No trade with other people ( they make nothing extra).
Example: African villages
Planned economy
All large economical moves are controlled by the government.
Example - North Korea
Market capitalist
Market mostly controls the economy, some government
Example - Australia
Market socialist
Mainly controlled by the government some controlled by the market.
Example: China
What is superannuation
Money put aside to use when you no longer have an income after retirement.
Why is superannuation important?
Since you don’t make money after retirement you still require money from somewhere to spend for primary needs. The money you put aside now can help to buy these things later on.
Advantages of saving
- you don’t need to pay anyone back
- helps you to manage your money more wisely
Advantages to using a credit card
- you can buy things straight away.
- don’t need to carry around cash.
What is a budget
A plan that lists expected income and expenditure over a given time, usually made with a view to making best use of finance.
What is impulse buying?
Buying things you did not plan to purchase in advance.
Why do people do it?
They see a tempting sale, shopping with friends ( peer pressure), they are not thinking in the moment, seems cheap and accessible.
Why is it bad?
You can end up spending all your money on things you do not need or really want instead of saving for better purchases.
