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In a perfectly competitive labour market, explain how equilibrium wages are determined by the forces of supply and demand.

The labour market is a factor market, which is a market where the factors of production are traded. The supply of labour comes from the pool of economically active citizens who want to be employed. Labour de...
AJ
Answered by Anish J. • Economics tutor
2783 Views

How are is consumer and producer suplus shown on a diagram of supply and demand? How are both the division and amount of total surplus determined?

Starting with the curves themselves, we have a downward sloping demand curve as more people are willing to buy at lower prices. Conversely, seller will be willing to offer more goods for sale as the price in...
JL
Answered by Joshua L. • Economics tutor
1996 Views

How are interest rates used by the Monetary Policy Committee to control inflation?

Inflation is the continuous increase in prices over time which can erode the value of money over time if left unchecked. This is the reason why the central bank has an interest in controlling inflation and k...
DJ
Answered by Dana J. • Economics tutor
2749 Views

What are the different types of inflation?

There are two types of inflation. The first, cost-push inflation, is where the RPI rises due to increased costs for firms across the macroeconomy. This could be down to a rise in the cost of imported raw mat...
TB
Answered by Tom B. • Economics tutor
2332 Views

What is price discrimination?

Price discrimination is when the same product is sold in different markets at a different price.It is a way for the firm to maximise its profits from more efficient pricing by charging each producer the maxi...
NT
3077 Views