Economic Articles

Demand and Supply is the most important topic in A Level Economics as it provides the basic foundation for your future topics like Market Failure and Macroeconomic Policies in your Year 2. If you can master this topic well, it can also be used to...

The theory of Price Elasticity of Demand “PED” is a very useful tool during price decision process. It is absolutely natural for consumers to react to price changes. When price of iPhone increases, the amount of quantity demanded for iPhone will definitely fall too because of Law of Demand –...

*Note: This topic is for H2 Economics only. So what exactly is income elasticity of demand? Can it be stretched like rubber band? And why is it short-formed “YED” ? Similar to the Price Elasticity of Demand “PED” (previous topic), YED shows the extent / magnitude of...

Have you ever wondered how is it possible to have a “floor” on price on any goods? Well first of all, price floor exist because of government intervention in the free market. In this case, the government deems that the market equilibrium price is determined way...

In a free market, prices and quantity of goods are optimally determined by the price adjustment process and demand and supply of respective goods, for example an iPhone or even a plate of chicken rice. However, as the name of this topic suggests, there are...

In our previous article discussing about price floor, the rationale of price ceiling is fairly similar to price floor – the government deems that the equilibrium price determined in the market is way too high and decides to keep an “artificial lid” below the equilibrium...