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MLC states that a devaluation (in the LR) will only have a positive effect on the current account if the sum of the elasticities of demand for exports and imports is negative and numerically greater th...

1. Inflation

If inflation in the UK is relatively lower than elsewhere, then UK exports will become more competitive and there will be an increase in demand for Pound Ste...

Increasing the level of direct taxes to reduce the fiscal deficit would lead to a disincentive to work amongst the rich as they will be less willing to work overtime and more inclined to reduce working...

The multiplier effect occurs within the circular flow of money, more precisely when people earn income and spend a proportion of what they have earned. When the government invests in infrastructure (fo...

An oligopolistic market is one where mutliple firms coexist in order to provide similar goods or services. The firm’s in this market are however, price makers despite similarities in the products. This...