hass pt2

• Economics


  A social science that focuses on the production, distribution and consumption of goods and services, as well as analysing the choices that individuals, businesses, government and nations make to allocate limited resources
• Microeconomics


  • Branch of economics that considers the behaviour of decision takers within the economy, such as individuals, households and firms
  • Focuses on supply and demand, and other forces that determine price levels, making it a bottom-up approach
• Macroeconomics


  • Branch of economics that studies the behaviour and performance of an economy as a whole
  • Focuses on changes in the economy such as unemployment, growth rate, gross domestic product and inflation
  • Takes a top-down approach and looks at the economy as a whole, trying to determine its causes and nature
• Leakages


  Reduce the flow of income in the economy
• Savings


  Leakage - Consumers are giving money to firms or producers, reducing money in firms and slowing the flow of income
• Taxation


  Leakage - Reduces the flow of income available through the economy
• Imports


  Leakage - The economy is giving money to other economies for resources, reducing the chance to improve the domestic economy
• Injections


  Increase the flow of income in the economy
• Investment


  Injection - Creates more chances for businesses to purchase new plant and equipment to expand output, gaining more money for the economy
• Government Spending


  Injection - Gives additional money to improve the economy
• Exports


  Injection - Giving our resources to other countries allows an increase in money for the economy