When the economy is growing unemployment is low, people have more ____ income and loans, and credit cards are easier to obtain.

Spare money that can be spent on non-essential items such as electronics, cars, fashion, travel, and entertainment:

Answer explanation

This is not discretionary spending, because spending is the act of using the money, rather than having it available to spend.

Money that must be spent on essential items such as food, rent, electricity, mortgage payments, transport and basic clothing needs:

When the economy is growing...

• Consumers are willing to spend more and save less.

• Consumers are less willing to spend and will save more.

• Consumers are less confident that they will keep their jobs and be able to maintain an income.

• Consumers are more confident they will keep their jobs and continue to earn an income.

When the economy is shrinking...

• Consumers are willing to spend more and save less.

• Consumers are less willing to spend and will save more.

• Consumers are less confident that they will keep their jobs and be able to maintain an income.

• Consumers are confident that they will keep their jobs and continue to earn an income.

When the economy is growing, banks are more willing to provide credit through loans and credit cards.

• True

• False

Answer explanation

This is because banks are confident that the good economic times will continue and customers will be able to meet their debt repayments.

Every quarter the Australian Bureau of Statistics calculates the ____ ____ ____ (CPI) based on a list of the typical goods and services purchased by a household.

When the economy is doing well...

• Prices of goods and services decrease.

• The demand for goods and services is greater than the supply.

• Employees wages raise and people are more able and willing to pay higher prices.

• Prices rise because it costs businesses more to find stock.

A steady upward movement in price level, decreasing purchasing power over a period of time:

Inflation means that one has to pay ____ money for the same goods and services.