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Reflective amount that one variable change given change in another variable |
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the percent change in qty. demanded exceeds the percent change in price (10% rise in $ leeds to a 20% fall demanded) |
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percent change in qty. demanded is LESS then %change in $ ( 10% change in %= 5% change in demand) |
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%change $= %change in demand ( vegitables, breakfast cerals...) |
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Change in qty/qty OVER change in P/p |
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| When a group of people all want the same rescource ( village wanting water, economics class wanting eco book...) |
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Intervention in Price Mechanism (Gov) |
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Definition
Subsides- gov services which private enterprise doesn't want to pay for ( public transport- doesn't turn a profit
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| indirect costs+benefits associated with the production +consumption of certain g+s that market fails to account for ( Neg. public transport- Pos- Airport) |
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| deciding or choosing hwo to satisfy unlimited wants with limited rescources |
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| where Gov reduces level of intervention in MP ex. sells assests ( telstra, Qantas, hospitals, prisons) |
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| Eco. variables whose patterns of fluctuation portray, in a resonably consistant and predictable way, the general course+level of aggregate eco. activity ( employment levels, inflation and eco. growth) |
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| System or process by which price changes bring about equality between S+D |
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| situation in circular flow where injections = leakages causing output, income, expenditure , employment to remai unchanged; balanced ( where s=d in a market) |
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| What is ment by Net Present Value |
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| the present value of the current benefits+discounted future benefits less the present value of the current costs + discounted future costs of a project ( value- benefits) |
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| term used to described a persons tendancy or desire to acat in a certain wau; potential investors may make an informed decision |
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| Satisfaction gained by the purchase of G+S ( me buying shoes!) |
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| price fixed by the govenrment at a lower rate then that that would be achieved in a free market enterprise ( established by the free operations of the price mechanism) |
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| price fixed by the government that is HIGHER then that that would be established through the free-market operations by the price mechanism |
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| on the hourly rate- paid mainly to blue collar workers |
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| fixed amount for the yr. intellectual workers ( white collar) more permident |
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| income that leaves the circular flow- outflow if expenditure ( savings, income tax, imports) |
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| investment expenditure ( company building factory) gov. expenditure ( hospitals and exports) |
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| Consumptions+Income+Government+Exports- Imports |
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| Factors determaining demand |
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| price of a commodity, buyers income, buyers tastes, population changem buyers expectations for the future |
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| Part of the income that is subject to change or removal ( travel, food, clothing) |
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| factors determaing Supply |
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| $ of a commodity, $ of production, technology used in production, effects of naturem future expectations of suppliers |
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| List some advantages of the CBA |
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Definition
| Ad= wider social+environmental impacts of a project or policy can be incorperated into the analysis. Time, Ranking: allows options to be ranked by their benefits |
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| List some disadvantages of the CBA |
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Definition
| Identifying every player effected. Attaching valuations to C+B that are accurate. Maximising equality |
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| Intervention in the Price Mechanism |
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Definition
| sucsessful G+S launched into MP- suppliers take advantage of the MP ( Iphone- Samsung copy) |
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| 1 producer/supplier domanating the market |
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| two producers/ suppliers dominating the market ( coles/woolworths) opposite of perfect competition |
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| Australian Competition + consumer comission ( ensures competition in Aus Market |
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Definition
| personal income, company tax, GST |
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| when 2 producers/suppliers set a fixed price tp stamp out competion- ILLEGAL |
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| Why is a CBA so valuable to economists+ the business world? |
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Definition
| allows business+ people to weigh the C+B of producing something. an educated decision can then be made |
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Definition
| the linking of eco. sections ( adam smith- invisible hand) |
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| Qty. demanded of G+S is INVERSE to the price of G+S |
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| qty supplied of G+S varies proportionally with the G+S |
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| qty of a commidity that will be purchased in a market over a given time and at a given price |
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| what to produce ( G+S) how to produce (labor/capitol/enterprise/land) For whom to produce (consumers) how much to produce ( supply+ demand) |
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| the consumer is "king" of MP because con. decides on the economic problem through their purchasing habits. They determain th pattern of production |
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| The Marketplace Enterprise Economy |
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Definition
| capitalist market- ownership of private property, use of market pricing, varying levels of gov. control. Self intrest for motivation for work |
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| Something that is easily substituted by another commodity |
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| wants that go together ( house/ furniture/plants... car/gas) |
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