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90199 Describe major sectors of the
economy and the relationships
between them
Achievement Criteria
Achievement
Describe major
sectors of the
economy and the
relationships between
them.
Achievement with
Merit
Describe major
sectors of the
economy and explain
the relationships
between them.
Achievement with
Excellence
Describe major
sectors of the
economy and fully
explain the
relationships between
them.
90199 The Economy
(a) Name the sectors labelled (A), (B), (C)
(A) Financial Institutions/Banks
(B) Government
(C) Producers/Firms
(b) Names of the flows labelled (1), (2), (3)
(1) Investment
(2) Income Taxation / Direct Tax
(3) Export Receipts
A
M
E
M
E
2/3 correct.
A
2/3 correct.
90199 The Economy
(c) Name the real flow that is linked to the following money flows.
Money Flows
Real Flows
Import Payments Imports
Consumption
Goods and services
Wages
Labour
A
M
E
M
E
2/3 correct
(d) (i) Describe what the Consumer Sector represents.
A
The consumer sector represents all
households of New Zealand grouped
together.
Correct
description
90199 The Economy
(d) (ii) Describe what the Overseas Sector represents.
A
The overseas sector represents the
economies in other parts of the world that
New Zealand trades with.
Correct
description
M
E
Includes:
‘that NZ
trades
with’, or
similar
(e) The “Y“ symbol represents income.
State the 3 types of income other than wages.
rent
profit
interest
A
2/3 correct.
M
E
90199 The Economy
(a) (i) Name the money flow from Producers to Government.
A
Company Tax / GST / Indirect Tax
M
E
M
E
Correct
(ii) Explain TWO ways this flow could increase.
• An increase in company profits will result
in increased amounts of company tax.
• An increase in the rate of tax will increase
the amount paid.
• An increase in the rate of Goods and
Services tax will increase the amount
paid.
A
Two correct
ideas
explained.
90199 The Economy
(b) Explain how the consumer, producer, and financial sectors are
interdependent.
The consumer sector relies on the financial
sector to provide interest on savings and to
provide loans for housing and other consumer
goods and services. The consumer sector relies
on the producer sector for income and the
provision of goods and services.
The producer sector relies on the consumer
sector to provide resources such as labour,
capital, land and enterprise, and to consume the
goods and services the producer sector provides.
The producer sector relies on the financial sector
to provide loans for investment in capital goods
and business expansion.
The financial sector relies on the consumer
sector to save their surplus income so loans can
be provided to the producer sector. The financial
sector relies on the producer sector to borrow
funds and to pay interest on those funds.
A
Any two
M
E
Mutual
reliance
between
two sectors
fully
explained
Mutual
reliance
between
three
sectors fully
explained
90199 The Economy
(a) Explain ONE immediate benefit and ONE flow-on effect tax cuts will
have for households in New Zealand.
A
(i) Tax cuts will result in an increase in
disposable income for households.
(ii) This will allow households to consume
more goods and services and enable an
increase in savings.
(i) increase
in
disposable
income
M
(i) and (ii)
correct
E
90199 The Economy
(b) (i) Fully explain the likely flow-on effects of the tax cuts on The
Producer Sector
The flow-on effects to producers from the
tax cuts are positive.
• Consumers will have more disposable
income so they will increase
consumption of goods and services.
• Producers will increase
production/output to meet the increased
demand. This should result in an increase
in profits.
• If consumers save more there may be an
increase in funds available for investment
by producers.
A
M
E
Flow on effects
explained with 2
points linking
consumer with
producer or
financial sectors.
Flow on effects
explained with 3
points linking
consumer,
producer or
financial sectors.
90199 The Economy
(b) (ii) Fully explain the likely flow-on effects of the tax cuts on the
Government Sector:
The flow-on effects to the government sector
from tax cuts are negative and positive.
 There will be a decrease in the amount of
income tax collected from consumers.
 If consumers spend their increased
disposable income there will be an
increase in goods and services tax paid
to the government, and eventually
company taxes.
 The net effect is likely to be negative so
there may be a decrease in government
spending on health, education, defence,
roads, police.
A
M
Flow on
effects
explained
with 2
points
E
Flow on
effects fully
explained
with 3
points.
90199 Describe major sectors of the
economy and the relationships
between them
JUDGEMENT
Achievement
5 x A or better
Achievement with
Merit
Achieved plus:
3xM
Achievement with
Excellence
Merit plus:
2xE