Readers Questions III

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You are welcome to ask questions on Economics. However, due to volume of questions, I can no longer promise to answer all questions.

I will post the answer on this blog, for everyone to benefit from.

I shall try to answer the economics question and / or point to other resources but please bear in mind.

  1. The replies will be guidance and not for duplication. Your essays should be your own work.
  2. My speciality is economics for British A Level standard. My university economics is rusty in parts, because generally I don’t use it in teaching A level economics.
  3. I can’t guarantee to always give full answers it also depends on my time schedule.
  4. I will answer as a new post. Check home page of blog for new post. With question and answers
  5. Generally, I don’t answer questions, which involve mathematical calculations, they tend to be doing someone’s homework. however, I may give examples, of calculations, if I think it helps explain economics principles.

I studied PPE at Lady Margaret Hall college, Oxford University, and currently work as an Economics A Level teacher. I have also examined several different economic units for Edexcel AS and A2.

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234 thoughts on “Readers Questions III”

  1. If central bank wants high interest rate to contain inflation, but low interest rates to help exporters then what are the policy instruments available at the same time? If interest rate is the only policy instrument, then would one objective has to be sacrificed for the other?

  3. Could deflation lead to devaluation of the UK Pound?
    If so, could there then be a case for the UK joining the Euro (if devaluation meant parity with Euro)? If we push the argument, could the UK be made more attractive to global business if devaluation of the Pound made it weaker than the Euro?
    (I guess you see the silver lining I’m seeing…)

  4. what’s the opportunity cost of a) owning a toothbrush? b) owning a used toothbrush? c) not owning a toothbrush at all? Thanks

  5. hi, would you please state which base rate the monetry policy should se in December. Taking into account all the econmic factors in the UK

  11. would you explain the fiscal policies that would be adcocated during a recession and during a period of inflation by those who (a) wish to expand the public sector and (b) wish to contract the size of government

  13. Hi Tejvan,

    What is meant by the Optimal Tariff?

    I have tried reading about this, but I fall at the first hurdle – I struggle to even understand what ‘Terms of Trade’ exactly means.

    Thank you for your help.

    Steven.

  14. This is the question..

    Suppose that by devoting all of its resources to the production of A, the nation of Econia can produce 50A. By devoting all of its resources to the production of B, Econia can produce 25B. The comparable figures for the nation of Optima are 5A and 5B. According to the principle of comparative advantage, which nation will specialise in which products? What are the limits to the terms of trade?

    My attempt on the question: Econia will produce A and Optima will produce B due to Compa. Advantage.
    Limit : 1A=1A to 1B= 2B (im not sure whether it is correct anot)

    Can anyone highlight on the methods or a guideline to derive the trade limit for specialisation?

    APPRECIATED! 😀

  15. Hi please help me i need to write 1000 words on ”how the UK government could use both fiscal and monetary policy to try and overcome the impacts on its economy of the slow down in the world economy resulting from the present ‘credit crunch’..”
    thanks so much

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