Ask an Economic Question

You are welcome to ask any questions on Economics. Though you might also like to try google custom search (top right) to see if the topic has been covered before.

I am looking to explain economic principles / ideas/ recent developments in economics. I can’t promise to answer, but will try if it meets the criteria below.

  • Please don’t ask me to do your coursework / assignment e.t.c. (I can usually tell if it is a homework question!)
  • Please don’t ask any maths calculations.
  • The question and answer will be published here where everyone can see it (including your teacher!)
  • I aim to try and simplify economics; as a rough guide I would aim at an understanding similar to a good British A Level student.
  • I am looking to explain economic principles / ideas/ recent developments in economics.
  •  I will answer as a new post, if you leave email address, I’ll usually send quick email. Check home page of blog for new post. With question and answers

Add comment at bottom of post.


2,512 thoughts on “Ask an Economic Question”

  1. what are the similarities between a consumers budget constraint and society’s production possibilities frontier, not just graphically but analytically?

    • For example, a company is employing labors to cut paper, at the beginning, first person employed would do the job alone. However, when 2 people are employed, they would improve the efficiency since one person can hold the paper and another would use the scissors (which is called expertise). But when there are more people employed, they’d gradually found that a lot of problems emerged, maybe there’re not enough tools, and the efficiency decreased. In another word, to make the same work done, the cost would increase as there are more people, so marginal cost would increase as the quantity increase.

  2. I love your site. Thank you!

    Here is my question: Why is payment for labor for roughly the same job so much lower in some countries than in others?

    • Here are some things that may help answer your question:
      1. Balassa-Samuelson Effect
      2. Purchasing Power Parity Theory and Exchange Rates

      The question which you are asking is quite complex but those two things can give you much insight

  3. As almost all the governments in the world print huge amounts of paper money, why haven’t long-term interest rates (nominal rates) increased? Does the existence of very low long-term interest rates tell us that the market does not expect inflation? How can this be, with all the money that’s being printed?

    • Price of commodity.This is the most fundamental factor that ensures regard for the law of demand
      Government policy of taxation and subsidization
      Population size and structure
      Political atmosphere
      Level of addiction
      Marital status
      Quality of product, etc

  4. I would just like to ask whether the ebook for WJec economics covers the natural rate of unemployment and the NAIRU. Also, does it include the short run Phillips curve, long run Phillips curve and the difference between the Keynesian and Neo-classical view of LRAS?


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