Economics yr 8

What is scarcity in economics?

The economic problem of having unlimited needs and wants, but only a limited amount of resources to fulfill them.

What is opportunity cost?

The value of the next best alternative given up when making a choice (e.g. choosing cake over ice cream means losing the enjoyment of ice cream).

What are the three core economic questions every society must answer?

1. What goods and services to produce? 2. How to produce them? 3. Who will receive them (for whom)?

Define demand in economics.

The quantity of a good or service consumers are willing and able to buy at various prices.

What are the main factors influencing demand?

Price of the goods/services, personal preferences, and income levels.

State the Law of Demand.

As the price of a good or service decreases, the quantity demanded increases (inverse relationship).

What non-price factor explains why people might buy a luxury Chanel handbag over a cheaper Anko handbag?

Brand status and prestige, which alter consumer demand regardless of base utility or price.

Define supply in economics.

The quantity of a good or service producers are willing and able to sell at various prices.

What are the main factors influencing supply?

Technology, production costs, and the number of active sellers.

State the Law of Supply.

As the price of a good or service increases, the quantity supplied increases (direct relationship).

What is market equilibrium (clearing price)?

The point where quantity demanded equals quantity supplied (Q_D = Q_S).

What is a market surplus and how is it resolved?

When supply is higher than demand because price is set too high. Sellers must decrease the price to clear stock.

What is a market shortage?

When demand is higher than supply because price is set too low.

What happens to the supply curve if a natural disaster occurs?

It shifts to the left, representing a decrease in quantity supplied and leading to higher prices.

What happens to the supply curve if the government introduces a production subsidy?

It shifts to the right, as lower production costs increase supply.

What causes a demand curve to shift to the right or left?

Non-price factors, such as a positive social media trend (shifts right) or negative quality reports (shifts left).

What is a Traditional / Subsistence Economy?

A self-sufficient system where production aims for local survival without money or profit motives (e.g. First Nations Australians prior to European settlement).

How are economic decisions made in a Market Capitalist Economy?

Private individuals/firms own resources. What is produced depends on consumer demand/profit; How depends on cost efficiency; For whom depends on purchasing power.

What is a Planned Socialist Economy?

An economy where the government owns most resources and central planning dictates production/distribution based on societal well-being.

What is the economic definition of a market?

Any venue or system where buyers and sellers interact to trade goods, services, or assets (does not need to be physical).

Define the Retail Market.

A market where finished goods are sold directly to final consumers in shops, marketplaces, or online.

Define the Labour Market.

A market where workers sell their labour (skills, knowledge, and effort) to employers in exchange for wages.

Define the Housing Market.

A market where properties are bought, sold, or leased to tenants in exchange for rent.

Define the Stock Market.

A market where shares representing partial ownership in public companies are bought and sold.

Define the Foreign Exchange (Forex) Market.

The largest global market, where different national currencies are bought and sold.

What is the Australian Taxation Office (ATO)?

The Australian government agency responsible for administering the national tax system.

Why do governments collect taxes?

To fund essential public community services and infrastructure, such as education, healthcare, roads, police, and skate parks.

What is Income Tax in Australia?

The main source of tax revenue in Australia, structured progressively so higher earners pay a larger portion of income.

What are government subsidies?

Financial payments funded by tax revenue to support the production or consumption of goods with social benefits.

What is the Goods and Services Tax (GST) in Australia?

A flat 10% value-added tax introduced on July 1, 2000, included in the retail price of most goods and services.

How is GST revenue distributed in Australia?

Collected by the federal government and 100% distributed back to state and territory governments.

How have living costs shifted compared to wages historically?

Cost of living has increased significantly (~300%), rising much faster than average wage growth.

How has workforce participation changed over the last 50 years?

Female participation in the workforce has grown substantially.

How have standard working hours changed over time?

Average daily working shifts have decreased from around 12 hours to 8 hours.

How have legal frameworks regarding child labor changed from the 1970s to 2026?

Child labor was prevalent or legal in the 1970s but is strictly illegal in 2026.

What is the primary objective of introducing technology in the workplace?

To increase production speed, lower manual labor requirements, improve product quality, and reduce consumer prices.

Give an example of modern autonomous tech used in Western Australia.

The RAC Intellibus in South Perth (autonomous transport vehicle).

What is global outsourcing and its benefit to Australian consumers?

Hiring lower-cost overseas labor for business operations, providing lower prices for Australian consumers.

What is local outsourcing?

Contracting specific operational duties (like building cleaning) to independent domestic suppliers.

How have digital tools changed work communication?

Email, messaging, and social media replaced traditional post for instant communication and direct customer engagement.

How does cloud storage support modern work arrangements?

It allows file access from any location, enabling remote work like online teaching.

What is casualisation of employment?

The trend toward hiring workers on short-term or casual contracts instead of permanent full-time roles.

What are two benefits and two drawbacks of casualisation?

Benefits: schedule flexibility and multi-job opportunities. Drawbacks: income uncertainty, no sick leave or superannuation.

What is the Gig Economy?

A labor market where workers use an Australian Business Number (ABN) to contract tasks directly with consumers via platforms like Fiverr or Airtasker.

What are the 4 core drivers of changes in the modern workforce?

1. Advances in technology, 2. Outsourcing of labour, 3. Evolution of communication tools, 4. Rising casualisation of employment.