Unit 4 Flashcards
(23 cards)
Definition of economy
All the activities involved in producing, selling and buying the products and services we require for our basic needs.
Production
All the activities needed to make a product or provide a service.
Distribution
The activity which get products/services to their destination.
Consumption
The purchase of products or services by the consumer.
Primary sector
Companies which use resources from nature.
Secondary sector
Companies which use raw materials to make products.
Tertiary sector
Companies which provide services.
Production
Creation of the product or service the company sells.
Accounts
Department that manages the company’s money.
Marketing
Department that creates advertising for products or services.
Purchases
Department that buys the materials and services the company needs.
Human resources
Department that employs and manages the company’s employees.
Money earned
Income
Money kept for the future
Savings
Plan for spending income
Budget
Bank notes and coins used to pay for products and services
Cash
Money spent on products and services
Expenses
Money used in an activity in order to make a profit
Investment
Amount of money left when subtracting expenses from income
Net income
Exchanging one product for a different product
Balance
When you havemore expenses than income you need to:
Spend less
When your income and expenses are balanced:
You cannot save money or spend more
When you have more income than expenses, you:
You can save money
