Year 10 Commerce Half-Yearly Exam Study Guide 2026 - Comprehensive Notes
Common Law vs Statute Law
Australian law is derived from two primary sources: Common Law and Statute Law.
Common Law: This is also referred to as case law or judge-made law. It consists of laws developed by judges through court decisions. When a judge makes a ruling on a specific case, it establishes a precedent that must be followed by future courts in similar cases.
Statute Law: Also known as legislation or Acts of Parliament, this is the law created by the parliament. Parliament passes documents known as bills, which become Acts once they are formally approved.
Precedent: A formal court decision that serves as a rule or guide for determining subsequent similar cases. Generally, lower courts are legally bound to follow the precedents established by higher courts.
Legislation: A formal term for statute laws that have been written and passed by the parliamentary process.
Resolution of Conflict: A critical legal principle is that if a conflict arises between common law and statute law, statute law takes precedence and overrides common law.
Comparison at a Glance:
Feature: Creation: Common law is made by judges; Statute law is made by Parliament.
Feature: Alternative Names: Common law is called case law or judge-made law; Statute law is called legislation or Acts of Parliament.
Feature: Development Method: Common law develops through court decisions; Statute law involves parliamentary debate and the passage of bills.
Examples:
Common Law: Donoghue v Stevenson (1932) — fixed the legal concept of the 'duty of care'.
Statute Law: The Crimes Act; The Environmental Planning and Assessment Act.
The Legislative Process: How a Bill Becomes a Law
A Bill is defined as a proposed law. To become an official law, it must proceed through several distinct stages in sequential order.
Stage 1: First Reading: The bill is formally introduced into parliament. Only the title is read aloud, and no debate takes place at this time.
Stage 2: Second Reading: The relevant minister provides an explanation regarding the bill's purpose and its primary features. This is the stage where the initial debate begins.
Stage 3: Committee Stage: The bill undergoes a detailed examination, being reviewed clause by clause. During this stage, members of parliament can propose and make amendments.
Stage 4: Third Reading: A final vote is conducted on the bill as a whole, including any amendments made during the committee stage.
Stage 5: Other House: Once passed in the first house (e.g., the House of Representatives), the bill undergoes the exact same stages in the second house (e.g., the Senate).
Stage 6: Royal Assent: After passing both houses, the bill is signed by the Governor-General at the federal level (or the Governor at the state level). Upon signing, it officially becomes an Act of Parliament.
Key Sequence: First Reading Second Reading Committee Stage Third Reading Other House Royal Assent.
Three Levels of Australian Government
Australia operates under a three-tiered system of government, each holding specific areas of responsibility:
Federal (Commonwealth):
Responsibilities: Defence, immigration, foreign affairs, social security, taxation, currency, and trade.
Exemplar Institutions/Services: The Australian Defence Force, Centrelink, and the issuance of passports.
State / Territory:
Responsibilities: Education, health, police, roads, public transport, and the state court system.
Exemplar Institutions/Services: NSW public schools, NSW Police, and state-managed roads.
Local (Council):
Responsibilities: Local roads, footpaths, waste collection, local parks, town planning/development, and libraries.
Exemplar Institutions/Services: Provision of rubbish bins, maintenance of local parks, and building approvals.
Why and How Laws Are Changed
Laws must evolve to reflect changes in the values and needs of the community. Primary drivers for law reform include:
Changing Social Values: Shifts in community attitudes over time. Example: Changes in laws regarding same-sex marriage to reflect support for equality.
New Technology: The emergence of technology creates legal gaps. Example: The introduction of cybercrime laws to address hacking and digital fraud.
Pressure from Groups: Lobby groups, unions, and community organizations campaign for reform. Example: Environmental groups pushing for stricter pollution regulations.
Court Decisions: Landmark cases can expose injustices or gaps, prompting parliament to create new legislation.
International Obligations: The need for Australian law to comply with international treaties or conventions signed by the government.
Changing Economic Conditions: Circumstances such as the rise of the 'gig economy' require new regulations for labor and taxation.
Methods of Change:
Parliament passing or amending Acts.
Courts setting new precedents.
Conducting Referendums to alter the Constitution.
Law Reform Commissions conducting investigations and making recommendations.
The influence of lobbying from community and pressure groups on politicians.
The Democratic Process and Voting Systems
Democracy: Literally meaning 'rule by the people'. Australia utilizes a representative democracy, where citizens elect officials to make governing decisions on their behalf.
Voting Systems:
Preferential Voting: Used in the House of Representatives. Voters rank candidates in order of preference (1, 2, 3…). This ensures the winning candidate has the support of the majority of voters.
Proportional Representation: Used in the Senate. The number of seats a party wins corresponds to their proportion of the total vote, allowing smaller parties a better chance at representation.
First Past the Post: Not used in Australia but common in the UK and USA. The candidate with the most votes wins, even without a majority.
Referendums: A direct public vote on a specific query, typically regarding a change to the Australian Constitution. To succeed, a referendum requires a Double Majority:
A National Majority (more than of all Australian voters).
A State Majority (a majority of voters in at least 4 out of the 6 states).
Success Rate: Historically, these are difficult to pass; only 8 out of 44 attempted referendums have been successful.
Political Parties: Organized groups with shared beliefs (e.g., Australian Labor Party, Liberal Party, Nationals, Greens) that develop policies to win government seats.
Political Action: Citizens can participate through joining parties, contacting Local MPs, signing petitions, protesting, or joining lobby groups.
Types of Government Structures
Democracy: Government by the people with protected rights like free speech.
Constitutional Monarchy: A system where a monarch (King or Queen) is the head of state, but their power is limited by a constitution. Australia is a constitutional monarchy where the King is the head of state but the elected parliament governs.
Republic: A system with no monarch; the head of state is usually an elected president (e.g., USA).
Federation: Power is shared between a central national government and regional state/territory governments. Australia is a federation.
Dictatorship / Autocracy: Absolute power held by one person or a small group. There are no free elections and limited citizen rights.
Theocracy: Government based on religious law or led by religious leaders, where laws are derived from religious texts.
Australia’s Classification: Australia is best described as a federal constitutional monarchy and a representative democracy.
The Circular Flow Model
This model illustrates the movement of money and resources through different sectors of the economy.
Basic Model Sectors:
Households: Owners of the factors of production (labour, land, capital). They supply labour to firms for income and use that income to purchase goods and services.
Firms (Businesses): Use factors of production to create goods and services. They pay households for these factors and receive revenue from consumer spending.
Main Flow Types:
Real Flow: The physical movement of factors of production from households to firms, and goods and services from firms to households.
Money Flow: The movement of wages, rent, and profits from firms to households, and consumer expenditure from households to firms.
Extended Model Sectors (The 5-Sector Model):
Government: Collects taxes (leakage) and injects money via government spending on infrastructure, services, and welfare.
Financial Sector (Banks): Receives savings from households (leakage) and provides loans for investment (injection).
Overseas Sector: Imports represent leakage (money leaving the economy), while exports represent an injection (money entering).
Equilibrium: The economy is in equilibrium when Injections = Leakages.
Injections: Government Spending, Investment, Exports (Increase economic activity).
Leakages: Taxation, Savings, Imports (Decrease economic activity).
Economic Growth and GDP
Economic Growth: An increase in the total output of goods and services produced by an economy over a specific period.
Gross Domestic Product (GDP): The total market value of all final goods and services produced within a country in a single year. It is the primary indicator of economic size.
Aggregate Demand (AD): the total demand for all finished goods and services in an economy at a given price level and period. It is calculated using where C=consumption, I = investment, G= government spending, X = exports, and M=imports
Growth Rate: The percentage change in GDP.
Formula:
Recession: Defined as two or more consecutive quarters (6 or more months) of negative economic growth (declining GDP).
Causes of Growth: Increased consumer spending, business investment, government spending on infrastructure, increased exports, population growth, and technological innovation.
Problems with Rapid Growth:
Inflation: High spending driving prices up.
Environmental Damage: Pollution and resource depletion.
Income Inequality: Benefits not distributed equally.
Overheating: Rapid, unstable growth leading to future crashes.
Unemployment: Types and Measurement
Unemployment: Occurs when individuals who are willing and able to work are unable to find employment.
Labour Force: Includes all persons aged 15 and over who are either working or actively seeking work.
Unemployment Rate Formula:
Underemployment: Individuals who have jobs but work fewer hours than they desire (e.g., a part-timer wanting full-time work).
Types of Unemployment:
Cyclical (demand-deficient): Caused by business cycle downturns. Example: Workers laid off during a recession.
Structural: Caused by changes in economic structure or technology rendering certain skills obsolete. Example: A factory worker replaced by robotics.
Frictional: Temporary unemployment when moving between jobs. Example: A teacher searching for a new school after resigning.
Seasonal: Caused by demand fluctuations at different times of the year. Example: Fruit pickers or ski resort seasonal staff.
Measurement Criteria (ABS): To be counted as unemployed by the Australian Bureau of Statistics, one must:
Be without a job;
Have actively looked for work in the last 4 weeks;
Be available to start work immediately.
Limitations of Statistics: They do not account for 'discouraged workers' (those who gave up searching) or the magnitude of underemployment.
Glossary of Selected Terms
Act of Parliament: A bill that has passed parliament and received Royal Assent.
Constitution: The document outlining the rules for governing Australia and the division of power.
Double Majority: Requirement for referendum success: a national majority plus a majority in 4 of 6 states.
Injection: Money entering the circular flow (Investment, Government Spending, Exports).
Leakage: Money leaving the circular flow (Savings, Taxation, Imports).
Lobbyist: A person/group attempting to influence government policy.
Statute Law: Legislation made by parliament.