EMS Scope of Work and Economic Principles

Vocabulary practice cards covering socio-economic imbalances, financial literacy, the history of money, scarcity, and basic accounting principles.

Geographic distribution of resources

A cause of socio-economic imbalances that relates to the location of urban and rural challenges.

Employment Equity Act

The South African law that directly addresses discrimination during apartheid in the workplace.

Sustainable job opportunities

The best solution to address poverty and inequality in South Africa.

Education choices

One of the advantages mentioned for urban or city living.

Consumable goods

Products like milk that are used up or consumed by the purchaser.

Capital

Funds used to start or grow a business, such as money Crazy Plastics lends from ABSA to open a new store.

Fixed Assets

Long-term resources purchased to start a business, such as Crazy Plastics purchasing a building.

Long-term liability

A debt such as a mortgage bond on a building reaching a value like $R450\,000$.

Expense

A cost incurred in operating a business, for example, the periodic mortgage bond payment of $R450\,000$.

Income

The money received by a business from its activities, such as a first sale to a customer.

Bank charges

The cost a customer pays to keep their money safe at a financial institution.

Interest

The reward a bank pays a customer for keeping their money safe in an account.

Minimum transaction parties

The lowest number of participants required for a transaction, which is two.

Internet banking

A modern way to handle money that is characterized as not being $100\%$ safe.

Post Office

One of the oldest financial institutions located in South Africa.

COMMISSION

A common type of formal personal income received alongside salaries and wages.

BUDGET

The process of planning one's monthly income and expenses.

SAVINGS

The act of putting money away for the purpose of investing.

VARIABLE

An expense of which the amount changes from month to month.

OPERATING BUDGET

The budget a business draws up for monthly expenses such as rent and insurance.

Global value of money

The total value of money currently estimated to be around $418\,\text{trillion}$.

Bartering

The oldest form of money, used before banknotes and coins.

Bitcoin

The newest form of money, defined as a string of code electronically mined by computer.

Medium of exchange

A factor of money that allows people to trade goods and services indirectly.

Unit of measurement

A factor that allows money to communicate the price of goods.

Storehouse for wealth

The function of money that provides individuals with a way to store their riches over time.

Cashless Society advantages

Benefits such as less danger of being robbed and more secure features.

Cashless Society disadvantages

Drawbacks including the high cost for merchants and monthly transaction fees for small purchases.

Scarcity

An economic feature dealing with how people satisfy unlimited wants and needs with limited resources.

Needs

Basic things that individuals have to have in order to survive.

Wants

Things people would like to have, often considered luxuries.

Primary needs

Basic essential things that individuals must have for survival.

Secondary needs

Things needed in life to live a healthy and balanced life, like education and contact with friends.

Limited resources

Physical goods, mostly natural resources like minerals and water, that are processed into products.

Recycling

A method to help address the problem of scarcity and limited resources.

Statement of Net Worth

A financial summary listing Assets, Income, Expenses, and Liabilities to find a person's total value.

Assets

Items of value owned, such as the Townhouse $R750\,000$ or Vehicles $R250\,000$ in Maggie's affairs.

Liabilities

Debts owed by an individual or business, such as an outstanding bond or credit card debt.

Net worth formula

$$\text{ASSETS} - \text{LIABILITIES} = \text{Net Worth}$$

Surplus

The financial state when income is greater than expenses ($\text{INCOME} > \text{EXPENSES}$).

TRADING/ RETAIL BUSINESS

The specific type of business entity identified for Crazy Plastics.

Gross Profit formula

$$\text{INCOME} - \text{COST OF SALES (STOCK)}$$

Shortfall

A financial result occurring when expenses exceed income, equivalent to a net loss.

Operating expenses

Costs like salaries and wages, electricity, and rates and taxes used in business activities.

Stock calculation (Crazy Plastics)

The monthly value of stock purchased, which is $25\%$ of Sales.

Rent income calculation (Crazy Plastics)

Calculation derived from renting $30\,m^2$ at $R120$ per $m^2$, totaling $R3\,600$.

Sundry Expenses

A category of miscellaneous small operating expenses of the business.

Vehicle finance

A liability category representing money owed for the purchase of vehicles.

Bond repayment

A periodic expense paid to reduce an outstanding mortgage debt.

Minimisation

One of the strategies mentioned to address limited resources along with re-use and conservation.