Business Terms!!!

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Households

People or families that who buy goods and services and provide resources like labour.

Firms/Businesses

Organisations that produce and sell goods and services to households.

Goods and Services

Things we buy and use to satisfy our wants and needs.

Factors of Production

What firms need to produce goods and services.

Income

Money in the form of wages, rent, interest and profit which is paid to households for providing resources.

Consumer Spending/ Expenditure

Money spent by households on goods and services.

Revenue

Money earned by firms from selling goods and services.

Production

Turning resources into goods and services.

Real Flow

The movement of physical things such as goods, services and resources.

Money Flow

The movement of money in the economy.

Loans

Money borrowed (usually from banks) to be paid back later with interest.

Interest

Extra money paid on loans, or earned on savings.

Taxes

Money paid to the government to fund public services.

Indirect Taxes

Indirect taxes include GST when paying for goods and services, and excise taxes.

Excise Taxes

Taxes on items such as tobacco or alcohol to try discourage their consumption.

Company Tax/Direct Tax

Tax on all profits made by firms including banks.

Income Tax

Tax that is paid by all wage and salary earners; this includes PAYE which is automatically deducted from wages and GST from buying goods and services.

Government Sector

Collects taxes and provides services like healthcare, roads and education.

Financial Sector

Includes banks and lenders that handle savings, loans and interest.

Imports

Goods and services bought from overseas.

Import Payments

Money that flows out of New Zealand to pay for imports.

Exports

Goods and services sold to people in other countries (from NZ).

Export Payments

Money that flows into NZ from overseas buyers of exports.

Overseas Sector

Includes all trade with other countries - imports, exports, and the flow of money in and out.

Subsidies

Money that is paid to firms from the government to help them to produce more of a certain good or service the government believes is important.

Transfer Payments

Money that is paid to households in the form of money transfers to help people who are sick or unemployed.

Interdependence

When two or more things need to rely on each other.

GST

A tax added to the price of goods and services, including imports.