DARTUTORS
Revision Material
characteristics of good money
- Acceptability
- Durability
- Portability
- Divisibility
- Scarcity
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money supply
notes and coins in circulation and bank deposits
Functions of commercial banks
- Accept deposits
- Carry out loans
- Exchange currency
- Financial advice
- Store valuables
Functions of central banks
- issue notes and coins
- manage government transactions
- stabilize value of national currency
- regulate conduct of commercial banks
- operating government's monetary policy
stocks
A share of ownership in a company sold to raise finance
Function of stock exchanges
- brings together buyers and sellers of stocks
- provides information on stock market prices
- supervise the conduct of firms and brokers
Salary
payment made on fixed basis, calculated on the basis of fixed annual rate, irrespective of number of hours worked.
Wage
A payment, per unit of time, to those who provide labor.
Wage rate
a standard amount of pay given for work performed
Wage factors of occupation
Factors of choosing an occupation based on amount of pay
Non wage factors of occupation
Other factors of choosing an occupation
- work hours
- job security
- working environment
- pension entitlement
- holiday entitlement
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net advantages
The attractiveness of a job due to wage and non wage factors
Factors of wage differential in different jobs
- skills/qualifications
- working hours
- risks in work
- geographic mobility of workers
Factors of wage differential in same jobs
- regional pay differences
- experience/ length of service
- discrimination
specialisation
division of labour in a team to maximize efficiency
Disadvatages of specialisation for individual
- repetitive and tedious
- rely on others for other parts of production
- many tasks can be replaced by machines
Advantages of specialization for individual
- best use of talent/skill
- increase skills and experience in tasks
- produce more output
market wage rate
wage rate for an occupation determined when the demand for labour is equal to the supply of labour
Factors of increase in labour demand
- increase of demand in goods/services
- increase in labour productivity
- increase in cost of capital equipment
- fall in non-wage employment cost
Factors of decrease in labour demand
- fall in demand for goods/services
- reduction in labour productivity
- fall in cost of capital equipment
- rise in non-wage employment cost
Factors of increase in labour supply
- improvement in net advantages for job
- rise in working population
- improved education and training for the job
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Factors of decrease in labour supply
- decline in net advantages for job
- fall in working population
- lacking of education and training for the job
Trade union
an organized group of workers formed to promote and protect the wages, benefits, and working conditions of its members
Roles of trade union
- negotiate wages and benefits with employers
- defending employee rights
- improve working condition
- support members taking industrial actions
- develop skills of union members
- provide recreational amenities to members
Factors that influence strengths of trade unions in negotiations
- number of representation of workers in industry
- elasticity of demand of goods and sevices of industry
Collective bargaining
The process of negotiating wages and other working conditions between trade unions and employers
Industrial action
Measures taken by the workforce or trade union to put pressure on management to settle an industrial dispute in favor of employees.
Overtime ban
Workers refuse to work more than their normal hours
Work to rule
Workers slowing down production by complying with every rule and regulation
Go slow
Working deliberately slow to reduce production
Strike
Workers refusing to work and also protest
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real income
income of an individual or group after taking into consideration the effects of inflation on purchasing power
disposable income
Income remaining for a person to spend or save after all taxes have been paid
interest rates
A fee paid to borrow money
Factors that increase borrowing
- rise in real income
- increase in wealth
- increase in availability of credit
- increase in consumer confidence
- decrease in interest rates
- decrease in availability of saving schemes
Factors that decrease borrowing
- fall in real income
- decrease in wealth
- decrease in availability of credit
- decrease in consumer confidence
- Rise in interest rates
- Increase in availability of saving schemes
Factors that increase saving
- rise in real income
- decrease in wealth
- decrease in direct tax
- decrease in availability of credit
- decrease in consumer confidence
- increase in interest rates
- increase in availability of saving schemes
Factors that decrease saving
- fall in real income
- decrease in wealth
- increase in direct tax
- increase in availability of credit
- increase in consumer confidence
- decrease in interest rates
- decrease in availability of saving schemes
Factors that increase spending
- rise in real income
- increase in wealth
- decrease in direct tax
- increase in availability of credit
- increase in consumer confidence
- decrease in interest rates
- decrease in availability of saving schemes
Factors that decrease spending
- fall in real income
- decrease in wealth
- increase in direct tax
- decrease in availability of credit
- decrease in consumer confidence
- increase in interest rates
- increase in availability of saving schemes
