Mock Q18 Flashcards
What does CPI stand for
Consumer price index
What is one impact of inflation on households
Reduces the ability to buy goods and services: due to increased costs consumers will have less disposable income meaning that they won’t be able to purchase as much goods and services as before due to increased prices resulting in a lower standard of living.
What is one impact of inflation on businesses
Rising costs:increases in price of raw materials causes business cost to increase as fuel and material cost goes up. The business may pass this price hike onto consumers.
What are two causes of inflation
Scaricty: As goods become harder to source the cost charged for them will go up so businesses can knock out low bidders and still maximise profit.
Purchasing power: As people have more disposable income businesses will increase prices as they know they can get away with it.
Two reasons why unemployment occurs
Technology: Due to new technology taking over previous jobs there is less need for human labour instead we have computers and robots doing this for us creating unemployment.
Business closure: unemployment will occur with businesses are forced to shut down due to not creating profits. For example, when Deil relocated thousands of jobs from Ireland to Poland in increased unemployment.
Outline one impact of job loss on individuals
Increase taxes: the people left in the workforce will have to pay higher taxes as the government need more money to fund social welfare payments as more people will be looking for jobseekers benefits
Outline one impact of job losses on the community
Harder to fundraise: businesses and people will have less disposable income meaning they won’t be able to sponsor local teams due to not having enough money. This means a community will find hard to fund raise and improve the local facilities.
What is one impact of job losses on Ireland economy?
Less revenue in a country: the government will be receiving less money from people as a result in the amount of people paying PAYE and VAT. This means that the country may become under run. This can lead to foreign investment decreasing as Ireland won’t be an attractive country for investment anymore.
What are two potential impacts on the economy of a budget surplus ?
Increase capital expenditure: due to a budget surplus the government may decide to fund more money back into the public by creating new roads and Children’s Hospital benefiting the people of the country e.g. new children’s house being built in Dublin
Clear the national debt : due to a budget surplus the government may decide to clear all national debts so they will not have to worry about them and it leaves the country in a good financial position and with a good reputation of paying loans.
Name two direct taxes
Income tax and corporation tax
Name two indirect taxes
Value added tax and excise duty
Identify two other sources of government revenue apart from taxation
EU loan and dividend from state company
What is a wage?
Income from employers that can change depending on hours worked, e.g. shopkeeper
Define the term salary
A ser income for a year/month for an employee e.g. teachers
Define the term direct tax
Levitate on the income or profit of the person who pays it e.g. income tax
Define the term indirect tax
A tax levied on goods and services rather than an income or profit, e.g. VAT
Why would you prepare a budget?
People make a budget to know how much money they have and make sure that they are running a budget surplus
What does VRT stand for?
Vehicle registration tax
What does CGT stand for?
Capital gains tax
What does CAT stand for?
Capital Acquisitions tax
What does LPT stand for?
Local property tax
What does PPSN stand for?
Personal public service number
What are two advantages of branding?
Consumer loyalty: if a consumer recognises brands they will say to trust them and buy for them more increase in the business sales and return business profit as they know they can trust this brand.
Higher prices: can be charged for branded products, as consumers often associate them with better quality and are willing to pay extra for this.
Explain two reasons why fast fashioned should be discouraged
Increased pollution: due to fast fashion high amounts of pollution are getting collected and ending up in landfills creating an eyesore for local people and attract lots of vermin into the local area. This pollution the environment needs to climate change and lots of wildlife as they swallowed these clothes.
Discrimination against workers rights: workers producing clothing for Shein are paid less than two cents an hour and work 16 hours a day and are working in overcrowded factories. We should stop buying from fast fashion industries and respect human rights and get the money minimum wage
Explain one internal source ideas for a business
Customer feedback: by generating feedback from the general public businesses are able to identify what consumers like and dislike about the product and can create a better product to satisfy consumers needs and wants.
Outline two reasons why business should prepare a cash flow forecast
To predict future cash flow problems: allow organisations to identify months there will be a lot of expenses. They do this so they know how much they need to borrow and pay back.
To help organisations live within their means: if an organisation can predict it’s expected monthly receipts they can plan their monthly spending to match it
Define the term AER
Annual equivalent rate
What is one economic benefits of using solar panels?
Cheaper: using solar panels to generate electricity I’d cheaper than burning fossil fuels meaning the family would have more disposable income resulting in a higher standard of living and more money in the economy
Define the term invoice
A document sent by the seller to the buyer as a bill for good supplied
Define the term statement of account
A document sent by the seller to the buyer listing all the transactions of that month
Define the term receipt
A document sent by the letter to the buyer stating how much has been paid
Are debtors current assets, the current liabilities
Current assets
What is one positive effect of economic growth and business businesses?
An increase in business activity in an economy will lead to an increase in the amount of goods produced and services provided from one year to the next. This is an indicator of economic growth. Economic growth benefits a community through increased employment and a higher standard of living.
Name one state agency that provide support to Irish exporters
Enterprise Ireland
Outline two benefits of international trade for Irish businesses
Increased sales: With fewer than 5 million consumers, the Irish market is quite small. By exporting, Irish businesses can increase sales and access much larger markets. This is very important for industries that rely heavily on exports. For example, Ireland exports over 80% of the beef we produce.
Spreads risk: A business can spread risk by not relying on its local market alone.
How do you calculate compensation?
Insured value over actual value multiplied by lost value
Three factors to consider when you’re saving
Reward: Will the savings earn interest? Interest is a reward for saving your money with a financial institution. It is extra money you will receive on top of the money you have saved. All financial institutions offer slightly different rates of interest. Savers may have to shop around to get the best deal.
Liquidity: Is it easy to withdraw or access your savings should you need to, i.e. how quickly can your savings be turned back into cash? Some savings accounts require you to give the financial institution written notice and penalties may apply if you withdraw earlier than the terms agreed.
Taxation: Will you have to pay tax on your interest? Deposit Interest Retention Tax (DIRT) is a tax on interest earned on savings. Some savings products offered by A Post, such as Savings Certificates and savings bonds, are not subject to DIRT.
Highlight difference between enterprise and an entrepreneur
Enterprise is all about finding new business opportunities and taking advantage of them to make a profit. An entrepreneur is an individual who takes a risk to start a business
