Term 1 Recap Flashcards
What kind of society is industrialised?
Modern
What kind of society uses basic methods to hunt and harvest food?
Traditional
What is bartering?
The exchange of goods without using money
What are commodities?
Items that are used to trade
What is a promissory note?
A note signed by the buyer promising to pay the seller
Why did bartering give way to currency?
Because not all commodities had the same value
What were the first forms of currency?
Coins and cowrie shells
What did coins give way to?
Paper money or banknotes
What do we use for most transactions today?
Electronic banking
What do consumer economies mean?
More money is spent but this harms the environment
What are needs?
The things that people can’t survive without
What are wants?
Things that people would like to have but don’t need
What are primary needs?
Physical and security needs
What are secondary needs?
They are not necessary for pur survival and are considered wants
What is tge economic problem?
There are limited resources to satisfy unlimited needs and wants
What are the most valuable resources?
Natural resources of labour and capital
What are the four factors of production?
Labour, capital, land and entrepreneurship
What doe stge primary sector do?
Extracts or processes raw materials (e.g. mining and farming)
What doe sthe secondary sector do?
They use raw materials to manufacture goods (e.g. factories)
What does the tertiary sector do?
Sells the goods and provides services to the community
What does a producer do?
Makes the goods or provides the services
What does a consumer do?
Buys and uses the goods and services
Can households be both a producer and a consumer?
Yes
What are consumer goods?
Goods that are often used up and need to be replaced
What should we do with consumer goods to create a sustainable environment?
Recycle or reuse them
What happens in a developing country?
Their industry and economy is still developing; citizens have low average incomes
What happens in a developed country?
They are industrialised and technological; citizens have high average incomes
What is an informal business?
A business that is not taxed and does not contribute towards the GDP
What is a formal business?
A business that pays tax and contributes towards the GDP
What is the GNP?
The value of all the products and services a country produces in one year
What does a trading business make money from?
Selling goods
What does a manufacturing business make money from?
Making goods
What does a service business make money from?
Selling services
Formal businesses are…
More expensive to run and pay tax
Informal businesses are…
Cheaper to run and don’t pay tax
Formal and informal sectors are…
Both consumers and producers
Why do natural disasters affect the economy?
They destroy businesses
Why do health epidemics affect the economy?
Businesses lose skills when people get sick or die
