An indirect tax is charged on producers of goods and services and is paid by the consumer indirectly. Examples of indirect taxes include VAT, excise duties (cigarette, alcohol tax) and import levies. Example of VAT as an indirect tax VAT rates may be set at 20%. This percentage tax is known as an ad Valorem …
If countries specialize in the production of certain goods and then trade with other countries there will be an increase in economic welfare. Countries will specialize in those goods where they have a comparative advantage. Absolute Advantage This occurs when one country can produce a good with fewer resources than another. E.G. if USA can …
Concentration ratio refers to the market share of the largest firms in an industry. For example, a five-firm concentration ratio of 65% means that the five largest firms have more 65% of market sales. If the concentration ratio increased, then one or two firms may start to dominate the market and the firms will be …
From an economic perspective, the EU can be criticised for various reasons including Common agricultural policy (CAP) Regulated labour markets – higher structural rates of unemployment Deflationary bias of ECB Problems of Euro Problems of free movement of labour Common Agricultural Policy CAP The CAP was one of the most inefficient economic policies and a …
The infant industry argument states that developing countries are justified to put tariffs on imports if they are seeking to develop new industries and diversify their economy. In particular, there is a justification for placing tariffs on industries where a country has a latent comparative advantage. This means that if they can develop infrastructure and economies …
Abstract. A look at the economic effects of Britain leaving the European Union. Summary. The UK has been a member of the European Union since 1973. The European Union gives many economic benefits to member countries. These include free trade, inward investment from European companies, free movement of labour, harmonisation of regulations and qualifications and …
A capitalist economic system is one characterised by free markets and the absence of government intervention in the economy. In practice a capitalist economy will need some government intervention, primarily to protect private property. (This is important to distinguish capitalism from anarchism, where there is absolutely no government present) Features of a capitalist economic system …
There are arguments that the legal driving age is too low, and this causes an unacceptably high level of traffic accidents. Raising the driving age, would ensure young drivers are more experienced and less prone to rash judgements which can put other road users at risk. Arguments for raising the legal driving age include: 1. …