Inflation is a measure of changes in the cost of living. It is calculated by using statistics such as Consumer Price index CPI, retail price index RPI. However, the official inflation rate doesn’t include every price and some consumers may experience different inflation rates. For example, if the price of basic food items increases 50%, …
The most common method for measuring living standards is using GDP per capita. This is national income divided by population and gives a rough guide to average incomes. High real GDP per capita indicates citizens are able to purchase more goods and services. World Map of GDP per Capita GDP per Capita. Source: Source: IMF …
HS2 is a proposed new railway line linking London Euston to Birmingham and in the second phase – Manchester, Leeds, Sheffield and eventually Scotland. Supporters of high-speed rail argue it is necessary to meet the UK’s rapidly growing demand for travel. High-speed rail will provide the greenest, safest and most efficient form of transport. The …
In the post-war period, the UK labour market has seen many fundamental changes. In particular, we have seen a decline in full-time manual labour manufacturing jobs, and a growth in labour market flexibility. The current labour market is more diverse with more people working in self-employment, part-time jobs, zero hour contracts. De-industrialisation Since the early …
Some potentially common mistakes in economics. 1. Confusion of rates of change and actual levels What happened to the UK price level between May 2011 and Feb 2015? The answer is that prices rose at a slower rate. There was a fall in the inflation rate. Prices were still rising just at a lower rate. …
Household saving is defined as income that is not consumed. Savings can be kept in cash form, saved in a bank account or saved in long-term assets, such as government bonds. Quick summary of factors that influence saving levels Interest rates – higher interest rates make saving more attractive. Rising income enables higher savings. People …
Government policies to increase economic growth are focused on trying to increase aggregate demand (demand side policies) or increase aggregate supply/productivity (supply side policies) Demand side policies include: Fiscal policy (cutting taxes/increasing government spending) Monetary policy (cutting interest rates) Supply side policies include: Privatisation, deregulation, tax cuts, free trade agreements (free market supply side policies) …
A carbon tax aims to make individuals and firms pay the full social cost of carbon pollution. In theory, the tax will reduce pollution and encourage more environmentally friendly alternatives. However, critics argue a tax on carbon will increase costs for business and reduce levels of investment and economic growth. The purpose of a carbon …