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What would be the effect of a rise in consumption in the economy, use a diagram to help illustrate this effect.

A rise in consumption in the economy would cause an increase in aggregate demand. This is because the formula of aggregate demand is C+I+G+(X-M), with the C standing for consumption. Therefore, a rise in con...
CW
Answered by Chris W. • Economics tutor
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How do you know whether the demand for a good is price elastic or price inelastic?

If the Price Elasticity of Demand is between 0 and 1, which means that the percentage change in demand is smaller than the percentage change in price, then the demand is price inelastic.If the Price Elastici...
Answered by • Economics tutor
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How would you go about calculating inflation using CPI (consumer price index)

- The consumer price index is the official measure of inflation in the UK - 2 surveys are conducted. The first survey is the Living Costs and Food surveys which involves approx. 7000 households completing se...
Answered by • Economics tutor
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Explain why there may be a conflict between unemployment and inflation

If the unemployment in the economy is demand deficient unemployment (Keynesian unemployment), the government needs to stimulate growth in the economy and increase aggregate demand as there is a lack of deman...
JH
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The UK government are planning on imposing a tax on sugary drinks. Discuss how a tax could be used to decrease consumption of sugary drinks and outline some potential issues.

Gov should try place monetary value on welfare loss - this may be difficult tax would increase cost of production for firms - they supply less (shown on supply and demand diagram)tax would deter customers fr...
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Answered by Ahmad A. • Economics tutor
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