Definition – Price discrimination involves charging a different price to different groups of people for the same good. For example – student discounts, off peak fares cheaper than peak fares. Different Types of Price Discrimination 1. First Degree Price Discrimination This involves charging consumers the maximum price that they are willing to pay. There will …
A public good has two characteristics: Non-rivalry: This means that when a good is consumed, it doesn’t reduce the amount available for others. – E.g. benefiting from a street light doesn’t reduce the light available for others but eating an apple would. Non-excludability: This occurs when it is not possible to provide a good without …
A devaluation means there is a fall in the value of a currency. The main effects are: Exports are cheaper to foreign customers Imports more expensive. In the short-term, a devaluation tends to cause inflation, higher growth and increased demand for exports. A devaluation in the Pound means £1 is worth less compared to other …
A minimum wage is a legal minimum for workers. It means workers are guaranteed a certain hourly wage – helping to reduce relative poverty. However, a minimum wage could have potential disadvantages – in particular, there is the risk of creating unemployment as firms cannot afford to employ workers. “It has always been a mystery …
A current account deficit occurs when the value of imports (of goods/services/inv. incomes) is greater than the value of exports. Policies to reduce a current account deficit involve: Devaluation of exchange rate (make exports cheaper – imports more expensive) Reduce domestic consumption and spending on imports (e.g. tight fiscal policy/higher taxes) Supply side policies to …
Economic growth means an increase in real GDP – which means an increase in the value of national output/national expenditure. Economic growth is an important macro-economic objective because it enables increased living standards, improved tax revenues and helps to create new jobs. Aspects of economic growth Causes of economic growth Costs/benefits of economic growth Policies …
In summary, to reduce poverty, government policies could include: Means-tested welfare benefits to the poorest in society; for example, unemployment benefit, food stamps, income support and housing benefit. Minimum wages. Regulation of labour markets, for example, statutory minimum wages Free market policies to promote economic growth – hoping that rising living standards will filter down …
Disadvantages of EU membership include: Cost. The costs of EU membership to the UK is £15bn gross (0.06% of GDP) – or £6.883 billion net. See UK government spending. (UKIP claim that the cost of EU membership in total amounts to £83bn gross if you include all possible costs, such as an ‘estimated’ £48bn of …