Consumption Flashcards
Consumer confidence
Expectations about the future including interest rates, incomes and jobs.
Consumer durables
Products such as washing machines or computer screens that are not used up immediately when consumed and which provide a flow of services over time.
Consumer spending
Household spending on goods and services. In the UK, household consumption is the largest element of aggregate demand (GDP), accounting for 67% of the total in 2019.
Disposable income
Gross income less income tax and national insurance contributions plus welfare benefits.
Household income
The financial resources available to households to spend or save.
Household income, Original income
Income from jobs, private pensions, interest from savings
Household income, Gross income
original income + cash benefits
Household income, Disposable income
gross income minus direct taxes
Household income, Post-tax income
disposable income minus indirect taxes
Household wealth
The monetary value of assets – including property, shares, savings, pension fund assets.
Income
Income is a flow of money to factors of production such as wages and salaries paid to people in work, interest from savings and rental income from owning land/assets.
Interest rate
An interest rate is the cost or price of borrowing, or the gain from lending, normally expressed as an annual percentage amount.
Negative equity
When the value of an asset falls below the debt left to pay on that asset. Term is most commonly used in connection with property prices after a slump in house prices.
Pension fund
Fund that pools employees’ pension benefits and holds them so that they can be paid at retirement. The money is invested in stocks, bonds and other assets to boost returns and ensure that there are sufficient funds to be paid out.
Personal allowance
The amount of income you can earn before you start paying income tax. It is £12,500 in 2019.
