Prelim Flashcards
(24 cards)
What are the characteristics of a monopolistic market?
There are a large number of small firms with small barriers to entry with similar products being sold.
Why is ethical decision making by firms vital to the economic future of a country?
Because it will assist businesses to make informed decisions about production methods and employment which will impact the broader society.
Who are the four members of the Council of financial regulators?
Asic, RBA, APRA and Treasury
Which factors influence individual consumer choice.
Price of complements, advertising and income.
What are examples of social welfare payments?
Unemployment benefits, disability support and family allowance.
What is opportunity cost?
This is the loss of other alternatives when an alternative is chosen.
What is internal economies of scale
An internal economy of scale measures a company’s efficiency of production. That efficiency is attained as the company improves output when the average cost per product drops.
What is external economies of scale
External economies of scale are generally described as having an effect on the whole industry. So when the industry grows, the average costs of business drop. External economies of scale can happen because of positive and negative externalities.
What is internal diseconomies of scale
Internal diseconomies implies to all those factors which raise the cost of production of a particular firm when its output increases beyond the certain limit.
What is external diseconomies of scale.
External diseconomies are not suffered by a single firm but by the firms operating in a given industry. These diseconomies arise due to much concentration and localization of industries beyond a certain stage.
What is the law of demand
the higher the price, the lower the quantity demanded.
How to find labour productivity
Labour input
How to calculate unemployment rate
Total labour force
What is the Labour force
This is the number of employed and unemployed people in the country at any given time.
How to find the labour force participation rate?
Population aged 15 or above.
What is a trade union?
This is a group of workers who join together to ensure their interests are protected by influencing employees and lobbying governments.
What is an occupational union
This is a labourity based union. Examples include teachers or the meat industry.
What are the impact of unions on labour markets
They restrict supply of labour by insisting membership and they also protect the minimum wage adding a floor price.
What is an employeer association
These are groups that reperesent the interests of emp both award negotiations and public policy debates. Anloyers in example is the business council of Australia.
What are some things the fair work act of 2009 do?
They decide on the minimum wage, they dispute resolution and they also make the minimum workplace standards.
What are leakages
S + T + M (savings + Taxation + Imports)
What are injections
I + G + X (Investment + Government expenditure + Exports)
What is market failure
Market failure is the economic situation defined by an inefficient distribution of goods and services in the free market. An example of this is having to tax cigarettes due and use that tax to create hospital beds for those individuals as the market failure are cigarette users taking up non cigarette users hospital beds.
What is the cash rate
cash rate reflects the market interest rate on ‘overnight’ funds. These are the funds banks lend to one another on an overnight basis to meet their daily cash needs. When the RBA makes changes to the cash rate, it has knock-on effects on many of the moving parts of the economy, like spending, investment, employment and inflation.
