Effects of the budget on individuals and businesses

Economics Senior secondary 50

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Introduction

Students consider Budget decisions from the perspectives of different stakeholders. In doing so, they consider the effect of Budget decisions on:

  • income
  • spending
  • savings
  • investment

This activity addresses the following aspects of economics curriculums:

  • impact of budgetary policy on different households and businesses (circular flow of income)
  • government influences on the decisions of individuals and businesses.

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Teacher resources

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To print

Role cards

Suggested activity sequence

This sequence is intended as a framework to be modified and adapted by teachers to suit the needs of a class group.

  1. Organise the class into 6 groups. Note: groups can be made up of any number of students, depending on your class size. If necessary, use a grouping strategy to decide on the composition of groups.
  2. Generate hypothetical budget decisions or choose policies from the most recent Budget. If possible, select more than one decision for each group to consider.

    Possible policies

    • Increase or decrease in direct taxes (income tax, company tax).
    • Increase or decrease in indirect taxes (GST, excises).
    • Increase in government spending on welfare, education, health or infrastructure.
    • Decrease in government spending on welfare, education, health or infrastructure.
    • Changes to labour market regulations.
  3. Give each group one role card.
  4. Groups discuss how the decision will affect the person or entity on their role card. Remind students to use the circular flow of income when making their predictions.

    Use a discussion strategy to support student collaboration and participation, such as providing each group with a set of talking cards.

    Possible prompts

    • How do you feel about the decision?
    • How will the decision affect you?
    • How will the decision affect your behaviour in relation to:
      • income
      • spending
      • savings
      • investment
      • confidence?
  5. Each group presents their views (from the perspective of the person they are representing) to the class.
  6. As a class, discuss the effects of the decision on different stakeholders, any differences they identified and the reasons for these differences.
Effects of the budget on individuals and businesses - Teacher instructions (PDF, 148.79 KB)