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. …
M4 is known as the ‘broad money supply’. It is a measure of notes and coins in circulation (M0) + bank accounts. This includes private-sector retail bank and building society deposits + Private-sector wholesale bank and building society deposits and Certificate of Deposit. The Bank of England produce figures on M4 growth. [link] Money supply …
This graph shows how much interest rates have fallen in the UK. The Bank of England base rate is the main ‘official interest rate’ The 3 month libor rate is the rate at which banks lend to each other. It is important for determining interest rates set by the commercial banks. Interest Rates are likely …
The Spanish economy is facing many difficult challenges. Housing Boom and Bust. Despite a relatively prudent banking sector, Spain experienced a real boom in the housing market. This was partly caused by foreign demand for holiday homes. House prices rose and there was also a boom in construction. Construction accounted for a large part of …
Has the internet made price discrimination more difficult or easier? Price discrimination is charging different prices to different groups of consumers for the same good. Price discrimination requires that firms Can separate markets into different distinct groups Groups have different elasticities of demand The firm can prevent resale The costs of separating markets are less …
There is an interesting article in the Economist about immigration and the impact on the Irish economy. Immigration tends to encourage a range of emotive responses, but, its impact on the flexibility of labour markets is worth considering. In the boom years, Ireland was growing by up to 5% a year or more. Growth was …
Readers Questions: hi would you please describe the current state of the UK Economy. The UK economy is undergoing a serious recession. These are the main macro economic indicators 1. Economic Growth. source: ONS In the last quarter (Q3 2008), GDP fell 0.5%. GDP is also forecast to fall this quarter. The UK economy is …