Economics Y9 Test Flashcards
Opportunity cost, What is lost?
The opportunity to buy something else, or do something else.
Ways the government controls credit:
Limiting money on credit cards.
Minimum money repayments.
No access to children.
Prior finance assessment.
What is Debt?
Debt is money owed to the bank or a financial institution. Borrowed under conditions.
What is credit?
Credit is the amount of money that you can borrow.
What is the difference between a store card and a credit card?
A store card you can get store points or discounts, it has standard fees and high interest.
What is a personal loan?
A personal debt is loaned from the bank, often for cars and houses, they have a low interest rate.
What is buy now pay later?
You pay the amount typically over 4 weeks. e.g. $100- $25 per week. You get to take home the goods before paying.
What is a payday loan?
A cash converters quick loan. High interest, instant cash, normally less than $2000.
What is the difference between good debt and bad debt?
Good debt makes you money and increases net worth. e.g. Homes, education, investments. Bad debt is on labilities and decreases net worth, e.g. consumables, car, credit card.
What to do if you feel suspicious of a scam.
Don’t provide information.
Don’t click on links.
Don’t even open.
Some tactics that scammers may use:
Pressure you into making a decision.
Become your friend.
Threaten you.
Claim to be a professional.
Persistently contact anyone who responds.
Who is susceptible to scams?
People are under stress, people are feeling lonely, and it is older generations.
What is the most common type of financial decision?
Interest
Two ways interest can be viewed:
Interest is paid to you in the form of income. It is also known as the reward for saving.
Interest payable to financial institutions for borrowing money. It is the cost.
Why are interest rates low?
Since the global financial crisis in 2008, earnings of banks and consumers have been degraded.
Where can you invest money?
Realistic
Shares
Bonds
Betting
Collecting
Investment styles
Conservative: Stable growth, or high income.
Moderate: Don’t require an income, over 5 years.
Aggressive: Prepared investment for 10 years or more.
The main goal of a business:
To produce goods and services that consumers want to purchase. Most businesses aim to maximise their profits.
How do businesses maximise profit?
Sell more goods and services.
Sell goods and services at a higher price.
Reduce cost of production.
Come up with a new idea.
Make an innovation.
What is the difference between invention and innovation?
Invention is creating something entirely new.
Innovation is a new idea or process that adds to an additional idea or product.
What can a business do to become more innovative?
Improve new products
Repurpose products
Redesign products
Specialise products
Apple iPhone struggles
Touch screen difficulties
Pressure
Failed demos
People not engaged
Sacrifices.
Provide examples of what Australians do.
In May 2024, the labor force was 14.9 million.
Some are legally too young to work.
Some retired.
Some choose not to work.
3 industries are predicted to grow.
Caretakers
Software engineers
Education
2 Examples of how employment has changed.
- Shift towards casual and part-time employment.
- More women in the workforce.
Industry predicted to decline.
Clerical administration
Agriculture
Most common measure of causal worker.
A worker with no leave entitlements, , no sick pay, no holiday pay, payed by the hour at a higher rate.
Why are more Australians working part-time?
Family commitments. Studying or working multiple jobs.
Why have females in the workforce increased?
- Change in expectations.
- More education access.
Why are Australians working longer?
They will live longer so they are outliving their money. Stay active, maintain purpose.
Barriers of innovation:
Management, money, time, infrastructure, support, creativity.
How can consumers spend more money than they earn?
Savings
Bank loans
Credit card age:
18 years old. Prevents young people with little experience from becoming into debt. Must pass credit check.
Payment options open to credit card holders.
Pay off in full each month.
Pay it back with interest.
Credit cards vs Debit cards
Credit cards are not your money.
Debit cards draw from your bank account.
What stocks did you buy and why?
Rio tinto, because i know the company and it is a safe investment.