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There is a v simple formula for answering these 'explain' questionsStart with definitions - what is monopolistic competition? -10% of marksThen to score full marks, you must include:2 well-reasoned chains of...

Define Budget Deficit and Circular flow of income 2) Results = A reduction in the budget deficit leads to a reduction in net injections(government spending is an injection). Therefore a reduction in the budg...

The key concept here is that interest rates essentially represent the price of money. The central bank sets the interest rate to loan to high-street banks, and the high-street banks follow this guidance to s...

Price elasticity of demand (PED) is a measure of the % change in demand of a good which occurs in response to a change in price.There are four main factors which effect PED:availability of substitutes - if a...

An externality is a positive or a negative effect experienced by a third-party to an economic transaction. In production for example, an externality would occur when there is a difference in the marginal pri...