Readers Question: What the benefits and the negative effects of reducing all taxes? I wrote an Essay on the advantages and disadvantages of tax cuts The idea of cutting all taxes is key element of libertarian politics. Cutting taxes is often a mantra repeated by conservative parties, although in practice, they usually find it more …
Yesterday, I mentioned future contracts could be used as a way to insure against risky commodity prices. This is one way that future contracts can be used. Unfortunately, future contracts and options can also be used to speculate on the stock market. Stock market options enable investors to take a position on the stock market …
Readers Question: Why the fire service is a public domain and how is the fire service a merit good I think you mean why is the Fire Service a public good? A public good has 2 aspects. Non rivalry – Once consumed doesn’t reduce the amount available to others Non excludability – Once it is …
there is a saying if one person dies it is murder, if hundreds of people die it is mass murder and if it is thousands of people it is an act of God. If a single mother gets £20 a week benefits she is a ‘scrounger’ If you avoid paying £1000 tax, you are a …
About £77 billion was wiped from the value of leading FTSE 100 companies over fears of a US recession. The FTSE 100 index is now down to its lowest level in 19 months. In particular, stock markets were unimpressed by President Bush’s plan for tax cuts. In American politics tax cuts are often seen as …
Already since the start of the year the FTSE-100 has fallen 7%. Yesterday, the stock market fell 3% of 190 points on fears related to the growing credit crunch. In particular, American bank Citibank wrote off $18billion from its mortgage defaults. It hopes this will draw a line under the losses in the derivatives market. …
Economies of scale occurs when increased output leads to lower long run average costs. Diagram of Economics of Scale Note Economies of Scale occurs upto Q2. After Q2 dis-economies of scale starts to occur Basically as a firm expands it receives increasing returns to scale. To understand why economies of scale occur it is useful …
To cannibalise your assets means that you create a new product which eat into sales of your old products. For example, suppose Microsoft have good sales for its X Box. If it introduced a new superior product, like the ‘X box mark 2’. Nobody would want to buy the old X Box. Therefore, sales of …