When firms have some control over the price of their product, we call it an IMPERFECT COMPETITION. This also means that the firm has MARKET POWER; ability to raise price without losing all of the quantity demanded for their product. Thus, Market Power + Imperfect Competition = Major sources of Inefficiency So when we are talking about PURE MONOPOLY, we must keep in account of the following: A...
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5 steps to follow when solving any Economics paper
Every course has its own particular method of solving it. From preparatory courses to the usual theoretical ones, you need to take some smart step in solving your questions and these factors must also be applied to the papers of Economics. Because it is not just about reading the material and writing about it. Be it Microeconomics, macroeconomics, development economics or any other sub-domain, I...
10 important points about Perfect Competition in Economics
1. Perfectly competitive firm cannot affect the market price Because all the products sold in the market are identical--any rise in price leads to loss of customers Because there are many buyers and sellers- so the firm isn't the only firm which sells that product . 2. Perfectly Competitive firm faces a Horizontal demand curve Study smarterPerfect competition, monopoly and every market structure...
Why do we really want to study Microeconomics ?
Study smarterIf you are starting microeconomics from scratch, the Economics Made Simple Complete Bundle takes you from first principles to exam technique — a 914-page textbook, practice questions with mark schemes, flashcards and 100 real-world case studies.Everyday in our live we get to see something , somewhere and somehow related to Economics. Think about the cup of coffee your are...
Credit Control by Central bank
Central bank exercises monetary policy to influence rate of interest, money supply and credit availability. Central bank use different tools to achieve the objective of controlling the availability of credit in economy. There are several quantitative tools through which the central bank monitors liquidity of commercial bank and money supply. These tools help central bank to keep economy...
Welfare analysis drawing on Hicksian micro-foundations
Whenever policy makers want to measure the impact of a change in prices on consumers, welfare analysis comes into play. Given that reforms adopted can either create or destroy value, an assessment is needed of whether the measure taken will increase or decrease the consumer surplus. There is a broad range of reforms that can utilise welfare analysis and these include but are not limited to...
Monopoly’s Output Decision
The output decisions in case of monopoly differ in respects of the time period or the length of time span through the monopoly firm is operating. There are two kinds of time periods; i. Short Run: It is a time period in which one of the variable is fixed i.e could not be altered. ii. Long Run: It is a time period in which all the inputs are variable i.e variables or inputs are changeable. Study...
The Economic Goals of a Country: A Comprehensive Guide (Updated 2026)
A comprehensive 2026-updated guide to the nine macroeconomic goals every country pursues — economic growth, full employment, price stability, balance of payments, efficiency, equity, freedom, security, and environmental sustainability. Includes the four major policy trade-offs, the Bank of England’s 2022–2024 inflation case study, a 5-country comparison with 2024 data, a glossary, and practice exercises with answer keys.
Types of Unemployment
‘’Unemployment refers to the situation or conditions of an economy when skilled and qualified are willing to work at the current wage rate but they couldn’t get job’’ Unemployment effects an economy is an adverse manner. Unemployment has various kinds. Each kind of unemployment is caused by different factors. Every kind of unemployment affects a particular class of people who belongs to a...
The Classical Economic Model
If we had to apply the classical model principles to the global economy nowadays, it would be extremely difficult to make such simple assumptions really work. However, classical theorists like Pigou and Say were aware that a capitalist market economy could not self-adjust to the equilibrium point they described. Nevertheless, their ‘laissez-faire’ economy still makes the subject of current...
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