Econ unit 2 Trade topic

Exam prep

Income

Money that is typically received on a regular or recurring basis, e.g. wages, dividends, welfare benefits

Disposable income

Income available after taxes

Discretionary income

Income available after all necessary payments

Factor income

The return received by the factors of production for their contribution to production

EDHI (Equivalised disposable household income)

Disposable income adjusted for the size and composition of households

Henderson poverty line

A benchmark level of income for various household sizes, below which a household is considered to be living in relative poverty

Earned income

A reward to individuals for their direct or physical contribution to the production process

Unearned income

A revenue for indirect contribution to the production of goods and services, e.g. providing resources other than labour

Transfer income

Any income that is transferred from one group to another without providing goods, services or assets in return to the payer, e.g. Centrelink, child support payments

Private / market income

Income that is received in the market place primarily as a result of individuals making a contribution to the production process; also includes private transfers

Social wage income

Disposable income + social transfers of any kind, e.g. public housing, welfare, education

Wealth

The total monetary value of assets minus all liabilities e.g houses, bonds

Nominal income

The value of income that is received by an entity in actual dollar terms

Real income

The value of income received after taking into account the effects of inflation

Gini coeffcient

a number between 0.0 and 1.0 which indicates the degree of inequality in the distribution of income. 1 being absolute inequality, 0 being absolute equality

Lorenz curve

a visual representaion of a the distribution of income in an economy

Frictional unemployment

Occurs when a person is unemployed for a period of time while moving from one job to another

Structural unemployment

Occurs when the skills of unemployed people do not match the skills required by employers

Seasonal unemployment

Occurs when a person is unemployed because their skills are only demanded at certain times of the year, such as a fruit picker, ski resort worker or lifeguard

Hard-core unemployment

Occurs when someone's mental, physical or other characteristics prevent them from receiving a job offer

Hidden unemployment

People who have been discouraged from looking for work and have given up seeking employment