Economics Case Study - Unemployment

Unemployment in UK has reached 11 years high. Clearly the main reason for it is the reduced aggregate demand in the economy due to the global crises.

This case study covers the ‘Unemployment’ topic. Students read about the the latest unemployment figures in UK (report from BBC). Students are tested on the concept of unemployment, the cost of unemployment and ways of reducing unemployment.

Notes on Unemployment on dineshbakshi.com would be very useful for giving an indepth understanding on this topic. Click here

Click here to attempt the case study

US interest rates slashed to 1%

The Federal Reserve has cut its key interest rate from 1.5% to 1% in a widely expected move, as it aims to avoid a possible US recession.

The question arises

• Why do Central Bank cuts interest rates?
• What is the impact of interest rate cuts?

Interest rates are reduced in order to increase the aggregate demand in the economy.

Now the question arises 'How aggregate demand rises?'

• Loans become cheap, people will take more loans to buy houses and cars etc.
• Businesses will also find it the best time to go in for expansion plans, because the loans are cheap.
• As the interest rates are very low people will not put their money in bank, and will find more lucrative investment opportunities. They would rather invest their money in businesses where there are better returns. Businesses will boost.

Now when the aggregate demand rises,

Market forces start acting. After a certain period of time if the supply will not be able to keep up with the rise in demand, prices will go up and cause inflation.

This is where the Central Bank has to be cautious and closely monitor the market.

Audio Slideshow: A guide to the credit crunch

It seems as though the term 'credit crunch' is becoming common parlance. But do you know what it actually is - or how it came about?

Spend a few minutes with the BBC's Business Editor Robert Peston, as he explains why we are in the middle of a global financial crisis.

Click here to know more...

Sources of finance worksheets

5 new worksheets on Sources of finace has been added to the resource center of dineshbakshi.com. The topic has been divided into five identifiable area so as to make the it easy and systematic for students to understand the topic. 

Click here to goto the worksheets

These worksheets are in Flashpaper format. So you can print it directly from the webpage by clicking on printer icon on the toolbar.

Moreover these worksheets are in 'landscape page layout' so please do the needed setting on your printer before printing them.

Please do comment on these worksheet. Any suggestion will be highly appreciated.

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