CramPuppy - Free Revision Notes » Igcse » Economics » Economics
27: Nationalisation and Privatization
28: Stock Markets
29: Banks
30: Trade Unions
31: Mobility
32: Costs
33: Internal Economies of Scale
34: Internal Dis-Economies of Scale
35: Profit
36: Wages
37: Demand for Labour
38: Law of Supply of Labour
39: Factors Affecting the Supply of Labour
40: Efficiency of Labour
41: Interest
42: Economic Rent
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Economics Free Revision Notes
26: Types of Firm
Unlimited liability: liability
without limit. If the business faces financial crisis and is unable to
pay creditors (debts), the business owner will stand to lose not only
the money or capital investe
27: Nationalisation and Privatization
Nationalisation: Describes
the process of transferring industries from private ownership to public
ownership. The state buys the companies in an industry by paying
shareholders a price which approxima
28: Stock Markets
Stock markets give a sense of security to the business
Gilt-edged securities: fixed-interest, long term loans to the government. It is paid after long periods of time
Treasury bills: like gilt-
29: Banks
A bank accepts a deposit or they lend money (loans). They get the loan money by the other deposits.
Liquidity: the ease with which an asset can be converted into cash
What banks make sur
30: Trade Unions
Trade union: a group of workers coming together with similar work who defend the workers
There
are different types of trade unions, either for employees or employers.
The idea of these are that
31: Mobility
Geographical mobility: the ease with which workers move from one place to another
Occupational mobility: the ease with which workers move from one occupation to another
32: Costs
Fixed costs: costs that do not change (in the short run) with the change in the output level
1. e.g. House will always have the same amount of rent no matter how m
33: Internal Economies of Scale
Scale: level of output
(Internal) Economies of Scale: cost advantages that a business enjoys in the form of lower cost per unit/average cost when the level of out produced/scale of production&nb
34: Internal Dis-Economies of Scale
Internal dis-economies of scale: cost
disadvantages that a business will experience in the form of higher
average cost of production when a firm expands the level of production
Management Disec
35: Profit
Profit = Revenue - cost of production
Savings = income over and above consumption expenditure
Factors that affect savings are:
1. The level of income: it is the la
36: Wages
ncome - Deductions = disposable incomes
Deductions = income tax/membership bill
Disposable income = consumption (C), savings (S), investment (I)
Net pay: the disposable income. Also call
37: Demand for Labour
Demand for labour: a derived demand. Demand for labour is indirect.
1. The demand for labour is determined by the demand for the output produced by the labour: The
38: Law of Supply of Labour
(The amount of people who have a willingness to work)
supply of labour: the exception to the law of supply. It is called backward bending supply curve of labour.
After a while of paying more an
39: Factors Affecting the Supply of Labour
a) The size of the population
b) The structure and composition of the population
c) The number of working hour
40: Efficiency of Labour
Efficiency of labour: the productivity of labour i.e. the output per man/hour
Factors affecting efficiency of labour:
a) Educational qualification of labour force
41: Interest
Interest: reward for parting with liquidity
The interest rate is decided by the demand for and supply of loans.
The higher the risk, the higher the interest. They charge more to discoura
42: Economic Rent
Economic rent: what you get over and above transfer earning.
Transfer earning: the next best paid job
Rent of ability: special talent/ability that earns you income much greater than the average
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