A duopoly is a market structure dominated by two firms. A pure duopoly is a market where there are just two firms. But, in reality, most duopolies are markets where the two biggest firms control over 70% of the market share. Characteristics of duopoly Strong barriers to entry in the market, e.g. brand loyalty (Coca-cola …
Definition: The fiscal stance of a government refers to how its level of spending and taxation impact on aggregate demand and economic growth. Higher taxes and a budget surplus is seen as fiscal consolidation or deflationary stance. A budget deficit has an expansionary impact. A fiscal stance can be expansionary, neutral or deflationary. Expansionary stance: …
Sustainable economic growth implies that the growth rate can be maintained over the long term. Sustainable growth involves both Environmentally sustainable growth – e.g. not exploiting scarce resources. Sustainable growth in terms of low inflation and a balanced economy. Sustainable economic growth The long-run trend rate of economic growth is the rate of economic growth …
Summary – impact of devaluation in Yuan If the Yuan falls in value, Chinese exports will become cheaper compared to other countries (e.g. US, India, EU) A falling Yuan will increase demand for Chinese goods contributing to higher growth in China. However, a fall in the Yuan will make US and Indian goods relatively more …
Government intervene in labour markets to overcome market failure, protect workers health and safety and to reduce inequality. Government labour market regulations include. Maximum working weeks Statutory minimum wages Legislation to prohibit discrimination Protection against unfair dismissal. Health and safety legislation Right to join trade unions Legislation to auto-enroll workers in private pensions Regulations about …
The Covid recession is very expensive for governments. Not only are we experiencing the usual cyclical fall in tax receipts, but there has been unprecedented government spending – such as the furlough scheme for workers, loans for business and a large rise in welfare payments. Government borrowing will increase to record peacetime levels. In April …
What is Economic development? Economic development is the process of improving economic welfare in an economy. Economic development can involve a stronger economy enabling a greater range of social services that improve a nation’s welfare. For example, an undeveloped economy will be primarily based on agriculture and very limited social services such as health care …
Definition: Marginal revenue (MR) is the additional revenue gained from selling one extra unit in a period of time. Marginal revenue (MR) = Δ TR/Δ Q If a firm sells an extra 50 units and sees an increase in revenue of £200. Then the marginal revenue of each extra unit sold is £4 Example of …