Oil price futures are financial contracts which involve obligations to buy or sell an instrument in the future at a fixed price. Oil price futures are a derivative, which means their value derives from the price of oil. Typically, people may buy oil futures with a 3 month date from the present time. Oil futures …
Readers Question: From my studies in economics I have always known that when there is a recession, there is a high tendency for people to borrow at a low interest rate since there is a fall in the mpc due to high unemployment right? In a recession, people tend to borrow less and save more. …
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 …
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 …
A recession is a period of negative economic growth. Falling output leads to higher unemployment, and this rise in unemployment causes a negative multiplier effect. e.g. those made unemployed will spend less causing even less demand in the economy. Thus there are many factors which make it difficult to get out of a recession. What …
Water is a valuable commodity; with global warming it appears to be even more scarce. A report suggested that British rivers could see an 80% decline in water volumes during the summer months because of global warming and increased demand. With most scarce commodities like electricity and gas, you have to pay depending on how …
UK Inflation Since 2000 Readers Question: How can we have both inflation and deflation in the economy at the same time? (the RPI falling to 0% and CPI rising to 3.2%) Deflation requires a fall in prices. We would need a negative inflation rate (e.g -0.3%) to have deflation Note if the inflation rate fell …
Readers Question: Is there any other political influence on the falling rate of sterling, something like monetary policy or political uncertainty? And why did some news reports say inflation and weak sterling could be helpful to UK economy? Thanks. The value of a currency is primarily influenced by economic factors. E.g. weak sterling can be …