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Basic economic problem: Resources are limited but needs and wants are infinite

Opportunity cost: Something given up when we make a choice

Demand: The quantity of a good or service that consumers are willing and able to purchase at a
particular price

Supply: The quantity of a good or…

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Mortgage ­ a loan to finance the purchase of real estate (e.g. a house). A Mortgage is secured on the
house, which remains to be the property of the bank until the loan is paid off.
Credit card ­ cards that may be used repeatedly to buy products and…

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Why people work Why people may not work
Pay Remaining in education
Job satisfaction (Social aspect an achievement) Child care and Retirement

Temporary Employment: work that will only last for a specific period of time (usually a number of
weeks or months)

Seasonal Employment: work that is only required…

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Reward for Work
How people are paid:
Salaries - stated as annual earnings but are paid monthly. Mainly applies to full time workers, but can
apply to part time workers. Jobs paying salaries are more likely to be skilled ­ non manual
occupations. Pay stated as a yearly total


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Income Tax: tax on money paid to the worker, although not all income is taxed, the income tax will
be paid as a percentage of earnings. People only pay income tax on earnings above a tax free
allowance, and the percentage of tax paid depends on the amount of income…

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Government Influence - the government introduced a minimum wage in the 1990's, so now people
cannot be paid unfairly low wages. The minimum wag is the legal minimum hourly rate that can be
paid to workers, varying depending on the age of the worker.

Reasons why wages rates change


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Education - the government is encouraging more students to undertake vocation qualifications in
schools and colleges. To ensure that children who find academic work difficult do not leave school
without decent qualifications.

Apprenticeships - apprentices work alongside experienced staff and gain job specific skills. The
apprentice will normally receive training…

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relatively good levels of technology. They can therefore produce products much more
cheaply than UK manufacturers.

Competition and innovation ­ all companies have to work harder to attract consumers as
there are many more potential competitors. They try o lower prices and develop more
attractive and better quality products.


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If the value of the pound rises, you will receive more foreign currency, which will allow you to
spend more when you go abroad. But when the pound falls, you will receive less foreign currency,
and have to exchange more at a higher rate.

The Power of the Consumer

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Benefits of globalisation for the UK labour market

Jobs are created in sectors where the UK does well
New migrant labour skills lower costs and increase competitiveness
Opportunities to increase exports to UK markets
Drawbacks of globalisation for the UK labour market
Low skill jobs are lost, particularly affecting manufacturing…


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