A Common question at AS and A2 Level is to understand economic graphs and statistics. Look at the graph below and explain what happens to GDP at current prices between 1974-1983? Many students will answer – In this period GDP is falling. However, this is wrong. What is happening is that the growth rate is …
The economic performance of a UK Construction PLC will be affected by many factors, including the role of government, exchange rates and inflation. Discuss The construction industry tends to be a quite volatile sector of the economy. Investment spending in construction has a strong correlation to the rate of economic growth and future prospects. When …
I took out a student loan 13 years ago in 1995. I remember taking out the maximum possible loan, which in those days was about £3,800 over 3 years. Being an economist, I didn’t spend any of the loan but put it in a bank account and benefit from receiving a higher interest rate than …
Readers Question: The Bank of England has released £15bn into the economy. That increase in the money supply will surely cause inflation? So interest rates having fallen will be raised, worsening the housing market and making the credit crunch even worse, not better….surely? The Bank of England is planning to inject money, primarily into the …
Readers Question: Hi, Please could you explain this question. Contrast the likely effects of monetary policy decisions on the price of housing and shares. Monetary Policy involves changing interest rates to try and influence aggregate demand and target low inflation and high growth. If inflation was increasing above the government’s inflation target, they would increase …
Readers Question: Evaluate the view that the most effective way to reduce poverty is to increase significantly the state pension. Pensioners account for a growing % of the population; therefore inequality and poverty amongst pensioners is becoming a significant cause of relative poverty in the UK. For several years, the state pension has been index-linked. …
Readers Question: with economic scare, do you advise to invest? how do you predict inflation and interest rates will affect business? In the UK, interest rates have only fallen slightly since the start of the global credit crisis. The Bank of England has reduced rates from 5.75% to 5.25%. The Bank is still worried about …
Readers Question: Use the ideas and theories you have encountered in your study of the macroeconomic business environment to assess the possible impacts on China of holding the Olympic games in Beijing in 2008. The Olympic Games will effect the Chinese economy in the following way. Increase in Tourism. This is a short term effect …