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The focus of this topic is an investigation of how consumers and businesses make decisions about the choices they face, recognising that in a market economy, both are motivated largely by self-interest (Economics Stage 6 Syllabus).
Glossary of Terms
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TERM |
DEFINITION |
| Consumption | involves the satisfaction of wants. |
| Consumer sovereignty | A situation which exists when the composition of output adjusts to and reflects consumers preferences as expressed by their demands in a market. |
| Costs | Payments a firm must make, or incomes it must provide, to attract resources away from alternative areas of production. |
| Diseconomies of scale | Those increases in long-run average costs which accrue to a firm from increasing its scale of operations. Diseconomies may be two types, internal and external. |
| Economies of Scale | are the advantages a firm achieves by increasing the size of its operations. |
| Efficiency | is the use of resources to achieve the maximum level of output. |
| Globalisation | The international nature of markets including the international transfers of goods, services, labour, technology, investment and finance. |
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Firm
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is a business organisation which obtains the services of factors of production and transforms these inputs into either an intermediate or finished product. |
| Investment | is expenditure on goods not for current consumption. |
| Industry | is a group of firms producing closely the same or very similar products. |
| Productivity | A measure of the efficiency with which productive resources, i.e. labour, capital and land, are used. It is equal to the quantity of output divided by the quantity of input. |
| Profit | The reward for successful entrepreneurship and managerial creativity. It is a payment for uncertainty and risk-taking. |
| Rent | A payment for the use of land and natural resources, the supply of which is fixed. |
| Savings | is the part of income that is not spent. |
| Satisficing | The pursuit by a firm of a satisfactory level of profits necessary to pay an acceptable dividend to shareholders, maintain its market share and remain secure from takeover. |
The AusIndustry site includes a search engine and media releases on topics such as tax and Government policies relating to industries.
The Australian Productivity Commission site includes publications, media releases and inquires about productivity in Australia.
A good case study of a Business applying technology can be found at
http://homepages.ihug.com.au/~gep/activity2.htm
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Last modified 26th August 2006
Comments and enquiries to Tony
Stokes