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US-China trade

Tensions raised as tit-for-tat trade dispute escalates. 

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Model agencies collude to fix rates

Regulators find leading model agencies guilty of price fixing.

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Alternative finance

Report on the growth of alternative finance.

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Question 1

In each of the following 8 cases, identify what the product is:

YED/XED is: The product is: Give one example
XED = 0    
YED = + 10.0  
YED = - 0.2    
XED = + 0.2    
XED = +    
YED = + 0.3    
XED = + 12.0    
YED = - 15.0    

  1. A normal good with an inelastic response

  2. A normal good with an elastic response

  3. An inferior good with an inelastic response

  4. An inferior good with an elastic response

  5. A close substitute

  6. Not a close substitute

  7. A close complement

  8. Not a close compliment

  9. A perfect substitute

  10. A perfect complement

  11. Goods are not related

   See: answer

Question 2

You own shares in two firms, Wheat Products Ltd (WPL) and Flashy Games Ltd (FGL). WPL is a chain of farms producing wheat that is sold to millers. FGL is a computer software company making computer games for the fast growing computer games market.

You have conducted some research and found that, on average, YED for wheat products is – 2.0 and for computer games is + 4.0. You have received an economic forecast that tells you that national income will grow by 3% next year.

    a. Using diagrams, assess the likely impact of the change in national income on your two firms.

    b. The forecast for 5 years time is that the economy will go into recession, with a predicted fall in national income of 2%.

    c. Using diagrams, assess the likely impact of this change on your two firms.

    d. What strategies could your two firms adopt to reduce the risks associated with changes in national income?

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Sainsbury's-Asda merger

Sainsbury's and Asda confirm merger plans.

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Customs unions

Costs and benefits of customs unions.

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New materials

Multiple choice papers for Paper Three.

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Brexit update

Article 50

What trading options are available to the UK?

Savings ratio

Savings ratio falls to lowest level on record.

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Tax avoidance

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The OECD presents its final package for reform of international tax rules..more

Bank of England - cuts interest rates to 0.25%..more.

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