Reflecting and consolidating

Chapter summary
  • There a number of participants in the Australian economy including workers, businesses, consumers and government.
  • The economy can be divided into primary, secondary, tertiary, quaternary and quinary sectors.
  • Goods and services are created by producers for consumers.
  • These are made by combining economic resources known as the factors of production.
  • Resources include land and raw materials, utilities, labour, capital resources and entrepreneurial resources.
  • Governments make decisions about what will be produced, how to produce and who will receive the finished products.
  • Government decisions regarding the economy will vary according to the economic belief and philosophy of the government.
  • Governments will change budgetary or fiscal policy to stimulate or contract the economy.
  • Up until the 1950s more than one-third of Australian exports came from sales to the United Kingdom. Since the 1960s this has changed.
  • There is increased trade within the Asia-Pacific region.
  • Australia’s main trading partners include China, Japan, the United States and the Republic of Korea.
  • 2014 saw a number of free trade agreements signed by Australia and Japan, Korea and China.
  • Global issues such as economic events and natural disasters affect the Australian economy.
Interactive activity

Key terms

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Short-answer questions
  1. Describe how the government might intervene in the economy.
  2. Describe the different factors of production that would go into the production of a mobile phone.
  3. How has Australia moved towards the Asia-Pacific region to trade with?
  4. Why do governments sometimes run a budget deficit or a budget surplus?
  5. Why did the global financial crisis that started in the United States affect the rest of the world?
Extended-response question

Research the current policies of the state or local government in your area. What are the three top priorities of the government in regard to policies and economic performance? (You may use the state or territory government website to find information about budgetary policy and spending. The newspapers also give information – search for ‘budgets’ and ‘government policy’.)