Economics + Business Environment

Question 1

Barter

Answer 1

the swapping or exchanging of one good for another

Question 2

Biodiversity

Answer 2

the variety of plant and animal life in the world or in a particular habitat

Question 3

Business cycle

Answer 3

the cyclical fluctuations in the general level of economic activity

Question 4

Consumption

Answer 4

the purchasing of goods and services to satisfy needs and wants

Question 5

Corporate social responsibility

Answer 5

when businesses consider the interests of stakeholders, society and the environment when making economic and business decisions

Question 6

Depression

Answer 6

a severe contraction in the level of economic activity resulting in many business failures, high and sustained levels of unemployment and sometimes falling prices

Question 7

Economy

Answer 7

all activities undertaken for the purpose of production, distribution and consumption of goods and services in a region or country

Question 8

Exports

Answer 8

goods and services sold by local businesses to overseas consumers

Question 9

Fiscal policy

Answer 9

the use of the federal government’s budget to achieve economic objectives

Question 10

Globalisation

Answer 10

the process that sees people, goods, money and ideas moving around the world faster and more cheaply than before

Question 11

Global sourcing

Answer 11

seeking out the cheapest materials and supplies across national borders as if there were only one large market

Question 12

Imports

Answer 12

goods and services purchased by local consumers from overseas businesses

Question 13

Inflation

Answer 13

a general rise in prices across all sectors of the economy, causing money to lose its value

Question 14

Innovation

Answer 14

either adding a new product to an existing product line, or significantly improving an existing product or process the process of creating a new or significantly improved product, service or process (way of doing something)

Question 15

Interdependence

Answer 15

a joint dependence between participants in an economy; that is, the reliance of consumers, workers, businesses and governments on each other

Question 16

Interest

Answer 16

the price that must be paid in order to use someone else’s money

Question 17

Investment

Answer 17

the use of money to purchase equipment or premises for the establishment of a new business or the expansion of an existing business

Question 18

Labour market

Answer 18

the buying and selling of labour

Question 19

Law of demand

Answer 19

states that the quantity of a good or service demanded varies inversely to price

Question 20

Law of supply

Answer 20

states that the quantity of a good or service supplied varies directly with price

Question 21

Market

Answer 21

where the exchange of goods, services or resources between buyers and sellers occurs

Question 22

Market equilibrium

Answer 22

the point at which the demand and supply curves intersect

Question 23

Monetary policy

Answer 23

the Reserve Bank using interest rates to achieve economic objectives

Question 24

Price mechanism

Answer 24

the interaction of the forces of demand and supply that determines the price of a good or service

Question 25

Production

Answer 25

the creation of goods and services

Question 26

Recession

Answer 26

a relatively mild contraction in the level of economic activity resulting in reduced spending, rising unemployment and a slow rate of economic growth

Question 27

Saving

Answer 27

regularly putting aside some money for future use

Question 28

Transnational corporation

Answer 28

a large business that has branches in more than one country