12 ECO Required knowledge

1.1 the circular flow of income

individuals, businesses, financial
institutions, governments, international
trade and financial flows

1.2 Sources of income
the return for resources: wages, rent,
interest and profits
social welfare

1.3 Demand
law of demand, individual and market
demand, the demand curve
factors affecting demand
movements along the demand curve and
shifts of the demand curve

1.4 Supply
law of supply, individual and market supply,
the supply curve
factors affecting supply
movements along the supply curve and
shifts of the supply curve

1.5 Market price
market equilibrium (using diagrams)
movement to equilibrium
effects of changes in supply and/or demand
on equilibrium market price and quantity
through the use of diagrams

1.6 definition of the workforce
employed
unemployed

1.7 general characteristics of the Australian
workforce

1.8 Differences in incomes from work
wage outcomes for all persons by income
groups, occupational groups, age, gender
and cultural background
trends in the distribution of income from
work over time
arguments for and against a more equitable
distribution of income from work

1.9 role of the Reserve Bank of Australia in
determining the cash rate

1.10 influence of the cash rate on interest rates
1.11 inequality in the distribution of income
disadvantaged groups, relative poverty

1.12 externalities and the environment
pollution, climate change

1.13 fluctuations in economic activity
the business cycle and the adverse effects

of booms and recessions
1.14 reallocation of resources
types of taxes: direct and indirect, types of
expenses

1.15 stabilisation of economic activity
a brief overview of the stabilising role of
monetary and fiscal policies

1.16 the budget process
1.17 types of budgets
surplus, balanced, deficit

1.18 revenue and expenses