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What are the determinants of Demand? What is the effect of a change in the determinants of demand?

The determinants of demand are the factors that affect the quantity of a product that is demanded (by consumers) at every given price level. The main determinants of demand include: Income level, Consumer Pr...
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Answered by Helen P. • Economics tutor
14592 Views

What is the effect on the UK current account balance following an appreciation of the Sterling?

As the Sterling appreciates, goods and services from the UK become less internationally competitive. This is because more foreign currency is required to purchase the Sterling which means foreign consumers w...
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Answered by Erin B. • Economics tutor
2587 Views

Explain price elasticity of demand

Price elasticity of demand shows the responsiveness of the demand of a product to a change in price. This indicates the level of necessity or luxury of that good. For example, a litre of milk would be relati...
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Answered by Rohan D. • Economics tutor
2954 Views

How does a reduction in the interest rate affect aggregate demand in a closed economy?

Aggregate demand in the economy is made up of a number of components. Firstly, it consists of 'Consumption' expenditure, which is all spending by households on goods and services within the economy - anythin...
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Answered by Gillian W. • Economics tutor
2886 Views

How best to answer a question on how negative externalities lead to market failure.

When answering a question of this kind I like to use te acronym NOPOWA to ensure I hit all the key points. It is always good to draw the graph showing the negative externality to help illustrate your answer ...
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Answered by Erin T. • Economics tutor
5947 Views