Households Flashcards
1
Q
What is a disposable income
A
Income of an individual after all income related taxes and charges have been removed
2
Q
Consumption
A
Buying goods and services
3
Q
consumer expenditure
A
The amount of money spent on consumption
4
Q
Why would people consume more (3)
A
- Increased consumer confidence
- Higher disposable income
- Higher wealth
5
Q
Why wouldn’t people consume
A
- Higher interest rates
6
Q
What is saving
A
Income not spent
7
Q
Why do people save(5)
A
- Higher interest rates
- Lower consumer confidence
- Higher income/wealth
- Future consumption
- Availablity of saving schemes
8
Q
What is borrowing
A
Borrowing is the lending of money from an individual or instituition
9
Q
Why do people borrow (4)
A
- Lower interest rates
- More ways to borrow
- Higher wealth - banks are willing to lend
- High consumer confidence
10
Q
What do poor people spend more of their disposable income on
A
Necessities
11
Q
Which income group is most likely to spend, save, and borrow
A
Richer peopls
12
Q
A
