Econ

Question 1

Substidy

Answer 1

A Subsidy is a financial payment or other form of assistance given by the government to households or firms.

Question 2

What is Price Elasticity?

Answer 2

Price Elasticity is the measure how much the quantity demanded or supplied of a good changes in response to a price change.

Question 3

What is Aggregate Demand?

Answer 3

Aggregate Demand is the total level of spending in the economy at any given price

Question 4

What are the components of Aggregate Demand?

Answer 4

Aggregate Demand is made up of: C+I+G+(X-M)
Consumption+Investment+Government Expenditure+(Imports-Exports)

Question 5

What is Consumption?

Answer 5

Consumption is consumer spending on goods and services.

Question 6

What is Investment?

Answer 6

Investment is spending by businesses on capital goods.

Question 7

What is Government Spending?

Answer 7

Government Spending is spending done by the government on providing goods and services.

Question 8

What is Balance of Trade?

Answer 8

Is the difference in the value of imports and exports over a specific period of time.

Question 9

How is a 4 marker structured?

Answer 9

2 Knowledge
2 Application

Question 10

How is a 5 marker structured?

Answer 10

1 Knowledge 2 Knowledge
2 Application OR 1 Application
2 Analysis 2 Analysis

Question 11

How is a 6 marker structured?

Answer 11

2 Knowledge
2 Application
2 Analysis

Question 12

How is a 10 marker structured?

Answer 12

2 Points

1 Knowledge
1 Application
1 Analysis
2 Evaluation

Question 13

How is a 15 marker structured?

Answer 13

3 Points

1 Knowledge
1 Application
1 Analysis
2 Evaluation

Question 14

What is Investment?

Question 15

What is Net Exports?

Answer 15

Net exports are a country’s total exports minus its total imports, and are a key economic indicator:
Formula
Net exports = Value of exports - Value of imports
What it means
A country with positive net exports has a trade surplus, while a country with negative net exports has a trade deficit

Question 16

What is Aggregate Supply?

Answer 16

Aggregate supply is the total amount of goods and services that producers are willing and able to sell at a given price within a specific time period.

Question 17

What is Consumption?

Answer 17

Consumption is spending on consumer goods and services over a period of time.

Question 18

What is Disposable Income?

Answer 18

Disposable income is the money consumers have left to spend after taxes have been taken away.

Question 19

What is Deduction?

Answer 19

Is when you start with a hypothesis

Question 20

What is Induction?

Answer 20

Is when you collect evidence

Question 21

What is Utility?

Answer 21

Utility is the satisfaction or benefit derived from consuming a good.

Question 22

What is the Behavioural School of Economics?

Answer 22

The Behavioural School of economics is a school of economic thought based on evidence and observations to develop assumption of economic decision making

Question 23

What is a Substitute?

Answer 23

Substitutes are alternative products that could be used for the same purpose.

Question 24

What is a Compliment?

Answer 24

Compliments are product that are used together

Question 25

What is Supply?

Answer 25

Supply is the quantity of a good or service that firms are willing to sell at a given price over a given period of time.

Question 26

What is Price Elasticity of Demand?

Answer 26

Price Elasticity of Demand is the measure of the responsiveness of demand at any given change in price.

Question 27

What is Price Elasticity of Supply?

Answer 27

Price Elasticity of Supply is the measure of the responsiveness of supply to a change in price.

Question 28

What is Price Inelasticity?

Answer 28

Price Inelasticity happens if a change in price causes a proportionately smaller change in demand

Question 29

What is Price Elasticity?

Answer 29

Price Elasticity happens if a change in price causes a proportionately larger change in demand

Question 30

What are the Values of the types Price Elasticity of Demands

Answer 30

Elasticity >1 Unitary 1 Inelastic <1

Question 31

What is Consumer Surplus?

Answer 31

Consumer surplus is the difference between the price a customer is willing to pay for a product or service and the price they actually pay.

Question 32

What is Producer Surplus?

Answer 32

Producer Surplus is the extra earning obtained by a producer above the minimum required for them to supply the good or service.

Question 33

What is Inflation?

Answer 33

Inflation is a sustained increase in the general price level of goods and services in an economy over time.

Question 34

What are the Key Terms for All Definitions?

Answer 34

Quantity Difference Occurs Expenditure Saving Measure Total

Question 35

What is the Current Account?

Answer 35

The Current Account is a record of payments for the exports and imports of goods and services

Question 36

What are the components of the current account?

Answer 36

Goods, services, income and current transfers

Question 37

What is Appreciation?

Answer 37

Appreciation is an increase in value over time.

Question 38

What is a Trade Deficit?

Answer 38

A trade deficit occurs when a country imports more than it exports

Question 39

What are Investment Income Flows?

Answer 39

Investment income flow is the flow of money in and out of a business or country due to investment activities.

Question 40

What are Open Market Operations?

Answer 40

Open Market Operations are when the central bank purchases government bonds from banks, it's engaging in open market operations.

Question 41

What is Quantitative Easing used for?

Answer 41

Quantitative easing (QE) is primarily implemented to: Inject significant amounts of liquidity into the financial system Lower longer-term interest rates (especially when short-term rates are already near zero) Increase the money supply Stimulate economic activity and lending Prevent or combat deflationary pressures QE is typically used during economic downturns or financial crises when conventional monetary policy tools (like adjusting the short-term interest rate) have reached their limits or proven insufficient. By purchasing large amounts of financial assets (like government bonds and sometimes corporate securities), central banks provide banks with additional reserves, encouraging lending and economic activity.

Question 43

What is Expansionary Monetary Policy?