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Explain why firms in the pharmaceutical industry can charge different prices for the same drug in different countries. (15 marks)

For the pharmaceutical company to successfully price discriminate; the market must be split into two- both which have a different PED for the drugs. Consumers with inelastic price elasticity for drugs are th...
SK
Answered by Sana K. • Economics tutor
2762 Views

Explain how an increase in interest rates can affect total spending in the UK.

Interest rates have an impact on the component of aggregate demand (AD) in an economy. AD is made up of consumption + investment + government spending + net trade. A rise in interest rates would mean consump...
DS
Answered by Daisy S. • Economics tutor
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The elasticity of supply of frozen pizzas is likely to be more elastic than the supply of fresh vegetables. Do you agree with this statement?

For this question, we need to talk about the price elasticity of supply of two things (1) frozen pizzas and (2) fresh vegetables. If supply is more price elastic, then that means that supply is more responsi...
TD
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Evaluate one reason why trade may be beneficial for an economy (5 marks)

Trade is the international exchange of goods and services. An economy can engage in trade because of the variation of production efficiency between countries, it is able to export goods it produces at a rela...
AM
Answered by Ankit M. • Economics tutor
1899 Views

What is the difference between an inferior good and a normal good?

The difference between an inferior good and a normal good is how they react to a change in the consumers income.If there was a rise in the consumers income, they would demand more for a normal good, as per t...
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Answered by Justin S. • Economics tutor
2416 Views