HASS Economics Y9 - 3

• Potentially building savings?

  Investment- The process of putting money into a business or commercial venture (such as property or shares) with the expectation of making a profit.
• Investment: Assessing the risk?

  Investment- assessing the risk

  • Investing money means taking a risk. 
  • Taking an investment risk means there is a possibility of losing money. 

  Some investments are riskier than others;

  • Putting your money in an Australian deposit-taking institution such as a bank is generally considered low risk. 
  • Investing in the sharemarket or in property is considered to carry a higher risk. 
  • Higher investment risks often come with the potential to earn higher rewards, but there is also the risk for higher losses.
• Debt?

  • must be paid back (by the borrower) within a certain timeframe with interest.
  • Generally, debt can be considered to be ‘good debt’ if the money borrowed is used to purchase something that will provide income or increase in value. 
  • For example, a loan to pay for university tuition fees might generally be considered ‘good debt’ as it increases a person’s ability to secure a job and earn a higher income. 
• Is debt considered bad?

  • Debt is usually considered to be ‘bad’ if it is used to purchase something that will decrease in value over time and/or will not earn an income. 
  • A car loan may be considered to be ‘bad debt’ as a car is likely to lose value (depreciate) over time.
• What to do if scammed?

  • If  you notify your bank after two days, all your bank can do is send a ‘trace and recover’ request to the bank the scammer is with.  If the scammer accepts the request (unlikely) you will get your money back.
  • You can then report the cyber crime to the WA police for further investigation using the website ReportCyber:
  • Keep all evidence of the scam, screenshots of messages, transactions etc.
• Property p1?

  1. Def.: An investment where a house, unit, factory, building or land is purchased with the aim that the property gains value, so the property can be, re-sold with at a higher price. Properties can be rented, which means that someone is paying the landlord a set amount of money to stay there.
  2. Explain: Process of an investment property- property is bought by a consumer, overtime, that property may gain value . The aim is to a)resell the property for profit b) allow people to rent the property for profit
  3. Examples: Townhouses, apartment units, land
• Property p2?

  1. celebrities: Donald Bren is the wealthiest real estate mogul globally
  2. level of risk: Property investment is extremely risky because the land may lose value, not increase
  3. level of return involved: Aim to make money off property investment is a higher amount than it was to purchase it. This is profit.
• Economic Problem?

  Having unlimited needs and wants but limited resources available to fulfil those needs and wants
• Natural resources?

  Materials or resources that occur in nature and can be used for economical purposes
• Producer?

  A person, company, or country that makes, grows, or supplies goods and services to consumers
• Consumer?


  A person who purchases goods and services for personal use
• Scarcity?

  When the demand of a good or service is greater than the availability of the good or service
• Allocation?

  A key concept in economics and business: the way scarce resources are distributed among producers, and how scarce goods and services are divided among customers.
• Australian Competition and Consumer Commission (ACCC)?

  A body that promotes competition and fair trade in markets to benefit consumers, businesses, and the community.
• Goods?

  Tangible products that can be touched, like bread
• Services?

   Intangible products  that cannot be touched but benefit the consumer in some way, such as tutoring
• Market Capitalist Economy?

  An economic and political system where private individuals are the producers who exchange goods and services with consumers and in return keep the profit
• Market socialist economy?

  An economic and political system where the exchange of goods and services takes place via a market where consumers and producers exchange goods and services. The government/state predominantly owns the productive resources used to make goods and services