A positive economic statement is a statement that can be verified true or false. A normative economic statement is an opinion. It is a view that others may disagree with. Postive economics In the UK, Dec 2017 CPI inflation is 3.0% In the UK the rate of unemployment has increased by 50% in the past …
A credit rating is a judgement made on the security of government bonds. They are made by credit rating agencies who evaluate several factors and decide on their likelihood of default. A triple-A credit rating implies the bond is secure. A junk bond status implies the government is likely to default. Readers Question: Hello, I …
The Washington Consensus refers to a set of broadly free market economic ideas, supported by prominent economists and international organisations, such as the IMF, the World Bank, the EU and the US. Essentially, the Washington consensus advocates, free trade, floating exchange rates, free markets and macroeconomic stability. The ten principles originally stated by John Williamson …
Readers Question: What are the costs and benefits of the London 2012 Olympics? A cost-benefit analysis seeks to examine all the various costs and benefits. These include both the monetary costs and benefits and the non-monetary costs and benefits. Costs of London Olympics The financial cost of building facilities, which may only be used to …
Printing money creates a sense of nervousness amongst both economists and the general public. It immediately conjures up memories of hyperinflation in Weimar Germany in 1923 and Zimbabwe in more recent times. If a government prints money faster than the growth of real output it reduces the value of money and this invariably causes inflation. …
The polluter pays principle (PPP) is a basic economic idea that firms or consumers should pay for the cost of the negative externality they create. The polluter pays principle usually refers to environmental costs, but it could be extended to any external cost. In a purely free market, you would only face your private costs. …
In the Bank of England’s latest forecast for the UK, they predict reasonably good economic growth in term of real GDP. At the same time, forecasts for average real incomes are more pessimistic. The Bank of England suggests UK economic growth will be maintained by consumer spending – spending which will partly be funded by …
Measuring living standards is important for economic policy. However, in practice, there are several difficulties in measuring living standards and therefore there are several different measures we could use. The most common measure of living standards is to start with real GDP per Capita. World Map of GDP per Capita GDP per Capita. Source: Source: …