Readers Question: Hey, what do you think are the implications of the 2009 Budget? The most striking feature was the realisation of how much the government was needing to borrow and the depth of the recession. The Large planned rise in borrowing means that there is little if any scope for further discretionary fiscal expansion. …
Readers Question: How do fashion retailer make profit when they offer high discounts during sales? Everyday I walk past a leading fashion clothing shop. It seems they are always very quiet except during sales periods. During sales, you can see prices discounted by 50% to 75%. How do they make profit? Firstly, the profit margin …
Readers Question why do cafes charge extra service tax when they remain open on public holidays? Firstly, cafes are likely to have to pay higher wages to staff to compensate for the inconvenience of working on a public holiday. Charging extra service tax is a way of paying for the increased wage costs. Secondly, on …
Readers Question: Why do the Government often fail to achieve its main objectives of high economic growth, price stability, and a surplus on the balance of payments. Other objectives worth adding are low unemployment, low government borrowing and maybe stable exchange rate. Looking at the current climate of the UK economy, the government is only …
Readers Question What are your predictions for us/Canadian dollar currency. Do you think they will reach par in 2009 ? Recently the Canadian dollar has been weak against the US dollar. This is because of the plunge in commodity prices which depress Canadian export revenues and decrease value of Canadian Dollar. Despite many problems in …
The US Dollar is often viewed as a safe haven currency. It is still the world’s reserve currency and the thinking is that if the dollar goes bust the rest of the world will be in an even worse situation. Therefore, during the worst of the economic turmoil, the dollar remained relatively strong because investors …
Joking aside (previous post), this year will prove a very competitive year for getting into university. Because of the recession and rising unemployment, there is increased demand for going to university. Especially amongst mature students, doing a degree is seen as a way to avoid the difficult jobs market – hoping conditions will have improved …
The Chancellor used the Budget speech to cut his growth forecasts. The economy is now expected to contract by 3.5pc this year, but grow 1.25pc in 2010. This would mean growth starting towards the end of this year. The IMF are more pessimistic forecasting negative growth in 2010 of -0.4% (see – slow economic recovery) …