Economic Activity
In the five-sector circular flow model, these three sectors represent leakages out of the economy.
What are savings, taxation, and imports?
This economic term refers to a flow of money received by individuals or households on a continuous basis, such as wages, salaries, dividends, or transfer payments.
What is income?
A nation has this type of advantage when it can produce a good or service using fewer resources or at a higher level of productivity than another country.
What is absolute advantage?
This aspect of living standards refers to our access to goods and services, typically measured by income, wealth, and consumption.
What is material living standards?
Building approvals, share prices, and consumer expectations are classified as this type of economic indicator because they help forecast future economic activity.
What are leading indicators?
This phase of the business cycle is characterized by rising economic activity, falling unemployment, and increasing business and consumer confidence.
What is an expansion?
Interest earned on savings, dividends from shares, and rent received from investment properties are all examples of this type of income
What is unearned income?
An increase in export prices while import prices stay unchanged. This term describes what happens to Australia's Terms of Trade index.
What is a favourable movement?
Freedom of speech, crime rates, environmental quality, and work-life balance are all determinants of this type of living standard.
What are non-material living standards?
In the AD equation, the letter 'C' stands for this largest component of aggregate demand.
What is Private ConsumptionExpenditure?
Unemployment rates and bankruptcies are classic examples of this category of economic indicator, which change after the economic cycle has already turned.
What are lagging indicators?
A situation where a household's income is significantly lower than the average or median income of the broader society, preventing full participation in community life.
What is relative poverty?
An increase in inflation in Australia compared to its trading partners will cause this to happen to the value of the AUD?
What is a depreciation?
This economic concept describes the fundamental problem of unlimited wants colliding with scarce resources, which economic activity aims to address.
What is relative scarcity?
This side of the economy represents the total volume of goods and services that businesses are willing and able to produce, determined by production costs and capacity.
What is Aggregate Supply (AS)?
Rapid and sustained economic growth typically creates more jobs, which directly reduces this key macroeconomic problem.
What is unemployment?
On a graph measuring income inequality, this straight 45-degree diagonal line represents a society where every percentile receives an exact matching share of total national income.
What is the line of absolute equality?
Financial assistance and tariffs are both examples of this policy.
What is protectionism?
A scenario where a country experiences high economic growth and material wealth, but widespread depression, severe pollution, and stress reduce overall well-being. This illustrates a conflict between material and non-material living standards. Give the term often used in VCE for the condition of being overloaded by consumerism.
What is 'affluenza'?
While economic growth increases the availability of goods, it often brings affects third parties through traffic congestion, greenhouse gas emissions, and loss of biodiversity. Give the general term for these.
What are negative externalities?
Developed by the Melbourne Applied Institute of Economic and Social Research, this survey-based alternative measure tracks changes in Australian households' financial positions, economic outlooks, and willingness to consume.
What is the Consumer Sentiment Index/Consumer Confidence?
A tax system that takes a higher proportion of income from low-income earners than from high-income earners.
What is a regressive tax?
An increase in productivity in our major trading partners will cause this movement in Terms of Trrade?
What is a favourable movement?
If the financial sector experiences a sudden contraction where injections are significantly less than leakages, describe the immediate compounding effect this has on national production and employment via the circular flow model.
What is a contraction/recession?
Developed by the United Nations, this alternative composite index measures economic and social progress across three dimensions: a long and healthy life, knowledge, and a decent standard of living.
What is the Human Development Index (HDI)?