HSC Economics Exam Questions With
Answers
advanced economies
Post-industrial countries with high per capita income, competitive industries, and developed
commercial infrastructure; typically the richest countries, including Australia, Canada, Japan, the
United States, and nations of Western Europe
direct investment
the ownership of overseas facilities
economic integration
a process of eliminating restrictions on international trade, payments, and factor mobility
emerging economies
Developing countries, such as India or Singapore, that over the past two or three decades have begun
to develop a strong industrial base.
exports
goods produced domestically and sold abroad
free trade
the movement of goods and services among nations without political or economic barriers
global economy
the interconnected economies of the nations of the world
global supply chains
Product design often uses inputs from around the world
Some manufacturing and service activities are outsourced to countries where labor and/or materials
costs are lower
Products are sold globally
globalisation
The increasing integration of economies and societies around the world particularly through
international trade
imports
goods produced abroad and sold domestically
manufactured goods
items produced from raw materials
non tariff barriers
forms of restricting imports other than tariffs, such as quotas (ceilings on how many goods of a certain
kind can be imported)
,portfolio investment
short term movement of funds between economies for loans or the purchase of small share holdings
(less than 10% of total value of company)
protection
government policies that give domestic producers an artificial advantage over foreign competitors,
such as tariffs on imported goods
tariffs
Taxes on imported goods
World Trade Organisation
an organisation of 126 member countries that implements and advances global trade agreements and
resolves trade disputes between nations
composition of trade
mix of what goods and services are traded
gross world product
The sum of the gross domestic product of all countries
Foreign Direct Investment (FDI)
the buying of permanent property and businesses in foreign nations
International Monetary Fund (IMF)
International institution set up to maintain order in the international monetary system
speculators
investors who buy or sell financial assets with the aim of making profits from short-term price
movements.
transnational corporation (TNC)
global companies that dominate global product and factor markets. TNCs have production facilities in
at least two countries and are owned by residents of at least two countries
migration
movement of people between countries on a permanent or long -term basis, usually for 12 months of
longer
international division of labour
How the tasks in the production process are allocated to different people in different countries
around the world
,business cycle
Fluctuations in the level of economic growth due to either domestic or international factors
Gross Domestic Product (GDP)
A measurement of the total goods and services produced within a country.
International Business cycle
refers to fluctuations in the level of economic activity in the global economy over time
Regional Business Cycle
fluctuations in the level of economic activity in a geographical region of the global economy over time
comparative advantage
the economic principal that nations should specialise in the production in which they have the lowest
opportunity cost and trade in other nations and so as to maximise both living standards
opportunity cost
the most desirable alternative given up as the result of a decision "real cost", "economic cost"
free trade
a situation where there are no artificial trade barriers to trade imposed by governments for the
purpose of shielding domestic producers from foreign competitors
dumping
selling products in a foreign country at lower prices than those charged in the producing country
Tariffs
Taxes on imported goods
Quotas
restrictions on the quantity of foreign goods that can be imported
Subsidies
a sum of money granted by the government or a public body to assist an industry or business so that
the price of a commodity or service may remain low or competitive.
trade bloc
a group of countries that work together to promote trade with one another
trade diversion
occurs when higher cost suppliers within the free trade area replace lower cost external suppliers
absolute advantage
the ability to produce a good using fewer inputs than another producer
, Aggregate Demand
the total demand for final goods and services in an economy at a given time
Aggregate Supply
the total amount of goods and services in the economy available at all possible price levels
anti-competitive conduct
Behaviour that reduces the level of competition in the market.
APEC
Asia - Pacific Economic Cooperation, organization designed to increases multilateral economic
cooperation between nations bordering the Pacific Ocean
appreciation
An increase in the value of a currency
ASEAN
the Association of Southeast Asian Nations, an alliance that promotes economic growth and peace in
the region
ACCC
A federal government authority in charge of protecting the rights of consumers and ensuring there is
competition between companies by enforcing the Competition and Consumer Act (2010).. Their full
name is the Australian Competition and Consumer Commission.
Automatic stabilisers
mechanisms that reduce the impact of changes in the economy on national income
allocative efficiency
A state of the economy in which production is in accordance with consumer preferences; in particular,
every good or service is produced up to the point where the last unit provides a marginal benefit to
society equal to the marginal cost of producing it
ANZCERTA
Australia New Zealand Closer Economic Relations Trade Agreement
AUSFTA
Australia-United States Free Trade Agreement. Preferential trade agreement between US & Australia;
not completely 'free trade' agreement as there are still many restrictions esp. in agriculture
ACTU
Australian Council of Trade Unions is the peak trade union body in Australia, covering most trade
unions
Answers
advanced economies
Post-industrial countries with high per capita income, competitive industries, and developed
commercial infrastructure; typically the richest countries, including Australia, Canada, Japan, the
United States, and nations of Western Europe
direct investment
the ownership of overseas facilities
economic integration
a process of eliminating restrictions on international trade, payments, and factor mobility
emerging economies
Developing countries, such as India or Singapore, that over the past two or three decades have begun
to develop a strong industrial base.
exports
goods produced domestically and sold abroad
free trade
the movement of goods and services among nations without political or economic barriers
global economy
the interconnected economies of the nations of the world
global supply chains
Product design often uses inputs from around the world
Some manufacturing and service activities are outsourced to countries where labor and/or materials
costs are lower
Products are sold globally
globalisation
The increasing integration of economies and societies around the world particularly through
international trade
imports
goods produced abroad and sold domestically
manufactured goods
items produced from raw materials
non tariff barriers
forms of restricting imports other than tariffs, such as quotas (ceilings on how many goods of a certain
kind can be imported)
,portfolio investment
short term movement of funds between economies for loans or the purchase of small share holdings
(less than 10% of total value of company)
protection
government policies that give domestic producers an artificial advantage over foreign competitors,
such as tariffs on imported goods
tariffs
Taxes on imported goods
World Trade Organisation
an organisation of 126 member countries that implements and advances global trade agreements and
resolves trade disputes between nations
composition of trade
mix of what goods and services are traded
gross world product
The sum of the gross domestic product of all countries
Foreign Direct Investment (FDI)
the buying of permanent property and businesses in foreign nations
International Monetary Fund (IMF)
International institution set up to maintain order in the international monetary system
speculators
investors who buy or sell financial assets with the aim of making profits from short-term price
movements.
transnational corporation (TNC)
global companies that dominate global product and factor markets. TNCs have production facilities in
at least two countries and are owned by residents of at least two countries
migration
movement of people between countries on a permanent or long -term basis, usually for 12 months of
longer
international division of labour
How the tasks in the production process are allocated to different people in different countries
around the world
,business cycle
Fluctuations in the level of economic growth due to either domestic or international factors
Gross Domestic Product (GDP)
A measurement of the total goods and services produced within a country.
International Business cycle
refers to fluctuations in the level of economic activity in the global economy over time
Regional Business Cycle
fluctuations in the level of economic activity in a geographical region of the global economy over time
comparative advantage
the economic principal that nations should specialise in the production in which they have the lowest
opportunity cost and trade in other nations and so as to maximise both living standards
opportunity cost
the most desirable alternative given up as the result of a decision "real cost", "economic cost"
free trade
a situation where there are no artificial trade barriers to trade imposed by governments for the
purpose of shielding domestic producers from foreign competitors
dumping
selling products in a foreign country at lower prices than those charged in the producing country
Tariffs
Taxes on imported goods
Quotas
restrictions on the quantity of foreign goods that can be imported
Subsidies
a sum of money granted by the government or a public body to assist an industry or business so that
the price of a commodity or service may remain low or competitive.
trade bloc
a group of countries that work together to promote trade with one another
trade diversion
occurs when higher cost suppliers within the free trade area replace lower cost external suppliers
absolute advantage
the ability to produce a good using fewer inputs than another producer
, Aggregate Demand
the total demand for final goods and services in an economy at a given time
Aggregate Supply
the total amount of goods and services in the economy available at all possible price levels
anti-competitive conduct
Behaviour that reduces the level of competition in the market.
APEC
Asia - Pacific Economic Cooperation, organization designed to increases multilateral economic
cooperation between nations bordering the Pacific Ocean
appreciation
An increase in the value of a currency
ASEAN
the Association of Southeast Asian Nations, an alliance that promotes economic growth and peace in
the region
ACCC
A federal government authority in charge of protecting the rights of consumers and ensuring there is
competition between companies by enforcing the Competition and Consumer Act (2010).. Their full
name is the Australian Competition and Consumer Commission.
Automatic stabilisers
mechanisms that reduce the impact of changes in the economy on national income
allocative efficiency
A state of the economy in which production is in accordance with consumer preferences; in particular,
every good or service is produced up to the point where the last unit provides a marginal benefit to
society equal to the marginal cost of producing it
ANZCERTA
Australia New Zealand Closer Economic Relations Trade Agreement
AUSFTA
Australia-United States Free Trade Agreement. Preferential trade agreement between US & Australia;
not completely 'free trade' agreement as there are still many restrictions esp. in agriculture
ACTU
Australian Council of Trade Unions is the peak trade union body in Australia, covering most trade
unions
