News Corporation owned by Rupert Murdoch’s is seeking to take full control of satellite broadcaster BSkyB, by acquiring the 60.9% of the shares it does not already own. It has offered 700p per share, valuing BSkyB at over £12bn. So far BSkyB are trying to resist the takeover. News Corp already owns media channels such …
Readers Question: Using data and your economic knowledge assess the case for and against a government completely banning the sale and consumption of cigarettes. AQA (15) 1. Cigarettes are a demerit good. People underestimate the costs of smoking, e.g. lower life expectancy. It has been suggested that the true cost of a packet of cigarettes …
Readers Question: I watched the recent Channel 4 (I think) programme on the National Debt. In this Programme it gave an all inclusive figure of £4.8 Trillion. How can this be squared with the very much lower figures given on your site? I haven’t had chance to see Channel 4’s recent programme on National Debt. …
For many goods we expect the price to be determined by market forces – by supply and demand. For example, computers, cars, holidays, food e.t.c. However, there is another class of good where society dislikes the idea of prices being set by market forces. The best example is football tickets or Concert tickets. . In …
Readers Questions – why do restaurant charge different prices, for instance high price for water and reasonable price for food? ‘Serve them a drink before they can blink’ – this is what I remember learning when I worked in a Little Chef. We were taught to waste no opportunity to sell extras – drinks, water, …
Readers Question: How Much Loss Can A firm Make before going Bankrupt? Firms who make a loss, will not necessarily close down. There are various ways that firms can keep going Borrowing from Bank. Bank will offer loans if it considers the firm is likely to make a profit in the future. Selling shares. A …
Essay: To what extent is transport a contestable Market? A contestable market is a market where there is freedom of entry and exit. This implies there are low (or zero) sunk costs in the industry. A sunk cost is a cost which cannot be recovered on leaving the market (e.g. spending on advertising). Therefore, the …
For manufacturing investment, the real interest rate is important for determining the viability of investment. Lower interest rates make it cheaper to borrow. Therefore lower interest rates tend to encourage business investment. High real interest rates discourage investment. How interest rates affect the efficiency of investment At lower interest rates, the marginal efficiency of capital …