Commerce topic 2 Glossary

barter

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the swapping and exchanging of one good for another

business cycle

the cyclical fluctuations in the general level of economic activity

consumption

the purchasing of goods and services to satisfy needs and wants

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corporate social responsibility

when businesses consider the interests of stakeholders, society and the environment when making economic and business decisions

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depression

a severe contraction in the level of economic activity resulting in business failures, high levels of unemployment and falling prices

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economy

activities undertaken for the purpose of production, distribution and consumption of goods and services in a region

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exports

goods and services sold by local businesses to overseas consumers

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fiscal policy 

the use of federal government's budget to achieve economic objectives

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globalisation

the process that sees people, goods, money and ideas moving around the world faster and more cheaply than before

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global sourcing

seeking out the cheapest materials and supplies across national borders 

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imports

goods and services purchased by local consumers from overseas businesses

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inflation

a general rise in prices across all sectors of the economy, causing money to lose its value

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interdependence

reliance of consumers, workers, businesses and governments on each other

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interest

the price that must be paid in order to use someone else's money

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investment

the use of money to purchase equipment or premises for the establishment of a new business

labour market

the buying and selling of labour

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law of demand

states that the quantity of a good or service demanded varies inversely to price

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law of supply

states that the quantity of a good or service supplied varies directly with price

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market

where the exchange of goods, services or resources between buyers and sellers occurs

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monetary policy

The Reserve Bank using interest rates to achieve economic objectives

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