Oligopoly Behavior – a Game Theory overview | Welker's Wikinomics Blog

An excellent article on Oligopoly and game theory....it will come up...so read and watch the video clips.....that includes you Alex!

Understanding Oligopoly Behavior – a Game Theory overview Welker's Wikinomics Blog

Abu Dhabi gives Dubai $10bn to help pay debts

It had to happen......

BBC News - Abu Dhabi gives Dubai $10bn to help pay debts

Monopoly prices – to regulate or not to regulate, that is the question! | Welker's Wikinomics Blog

Useful article on natural monopolies....

Monopoly prices – to regulate or not to regulate, that is the question! Welker's Wikinomics Blog

IGCSE: The Monetary Policy Balloon game!

Check out the interactive game which should help you understand Monetary Policy and how it works......

Bank of EnglandEducationInflationThe Monetary Policy Balloon

Y10/11/12/13 House prices - interactive guide

Figures produced this week show that house prices have risen by 10% in the last 10 months. However a number economists a suggesting that in the next year house will fall by the same amount as we have a double dip in the housing market.
The Guardian have produced a great interactive guide to house price since 2006.

GSCE Economics - House prices - interactive guide

Economics - Alistair Darling’s debt dilemma

Here is an absolutely brilliant interactive guide from the BBC which outlines the possible solutions to the UK’s huge debt problems. This is a must read for all students of 'Macro economics'.

GSCE Economics - Alistair Darling’s debt dilemma – Interactive guide

Climate Change Summit...the worlds most important meeting!!!

The Copenhagen summit....solutions....what would you do?

Sunday Starter: Economics in the news (06/12/09)

Just for you Alex....

GSCE Economics - Super Starter Sunday - Economics in the news (06/12/09)

Y13 Economics: Regulating Industries in the UK

The icon below is an excellent up to date piece on regulation in the UK. It focusses on markets and industries, the tools they have to influence prices, incentives, output and profits in different industries and some of the justifications for regulatory intervention and the downsides.

There is also a cluster of good examples of competition policy in action during 2009 to bring your regulation / competition notes up to date.

Economics - Google Wave: Regulating Industries in the UK

GSCE Economics - Happy Holidays everyone!

Check out the advent calender......what a dismal year for the economy!!!

GSCE Economics - Great starter activity for every lesson up to Christmas!

Y13 - Ofgem regulates natural monopolies.

Bills to fund electricity upgrade

A typical customer pays £76 a year for electricity distribution.
The UK electricity regulator, Ofgem, says average electricity bills can increase by £4.30 a year for five years to pay for network upgrades.

The 14 networks that make up the UK supply were built in the 1950s and 1960s and are in need of investment.

Ofgem chief executive Alistair Buchanan said the proposals were "tough on inefficiency and poor service but fair in allowing the companies to invest".

And he said the new controls would lead to a greener electricity supply.

Mr Buchanan told the BBC that the customer was paying for the upgrade but that regulators had stopped companies from charging too much.

He said Ofgem had cut the sum wanted by companies by 8% to ensure value for money for the consumer.

Ofgem said investment on the UK's electricity infrastructure would be up 40% - to £7.2bn - compared to the last five years' spending.

The new investment figure includes £500m for a low carbon energy fund.

UK electricity networks are regional monopolies.

Regulators set price limits every five years to ensure a good service for customers to make up for the lack of competition.

Mr Buchanan also issued energy supply companies with what he called "a storm warning" - a message to them to make sure that households benefit from a fall in wholesale gas prices.

He said that if wholesale prices stayed where they were, bills must come down by next spring if companies wanted to avoid unspecified regulatory action.

Y13 Review Lesson: Perfect Competition

Excellent article and video on Perfect competition......watch, listen and learn.....

Review Lesson: Econ concepts in 60 seconds – Perfect Competition Welker's Wikinomics Blog

Y13 Review Lesson: Perfect Competition | Welker's Wikinomics Blog

Review Lesson: Econ concepts in 60 seconds – Perfect Competition Welker's Wikinomics Blog

Y13 Review Lesson: Perfect Competition | Welker's Wikinomics Blog

A great peice on perfect competition;

Review Lesson: Econ concepts in 60 seconds – Perfect Competition Welker's Wikinomics Blog

Y13: Costs of Production Presentation

May use this in lesson next week....

Lesson Plan: Costs of Production Presentation for Y1 IB Economics Welker's Wikinomics Blog

BBC News - Shares markets gripped by Dubai debt uncertainty

BBC News - Shares markets gripped by Dubai debt uncertainty

Y13 Economics - Global Economy Macroeconomic graphs

A quality web page which has lots of graphs for A2 Macro students (Unit 4). Check it out, add it to your faves!

Economics - Global Economy Macroeconomic graphs

BBC News - Spending sprees, mobile scams and a scary lion

A great new web programme from the BBC....items are short and to the point. Excellent for discussions and revision.

BBC News - Spending sprees, mobile scams and a scary lion

Y13 - BA merger 'good for passengers'???

An excellent article which discusses the merger between BA & Iberia. Billy Walsh even talks about the 'Synergies' involved. Also the merger is discussed from the point of view of the worker. An interesting area that is sometimes forgotten when discussing the pros and cons of integration.

BBC NEWS | Business | BA merger 'good for passengers'

Mr Bentley

Simon's Cat - just for fun!

I could not help but laugh at this new 'You Tube' phenomenon....new toy to rival Mr Meekat perhaps???



Mr Bentley

Agriculture and price fluctuations

In Asia rice prices have almost tripled this year and as producing nations enforce export restrictions to protect their own supplies, stocks are dwindling in those countries relying on imports.

The Philippines is one of the countries worst affected. This clip highlights the problems faced by countries when the supply & demand scheduals cause drastic price changes.....excellent information for Unit 1 Economics.



Mr Bentley

Y13 - Building companies fined £129.5m by OFT

This BBC report highlights the problems faced when competition law is breached. This could easily be a case study question in your Unit 3 exam.

BBC NEWS Business Building companies fined £129.5m

Mr Bentley

DBS Economists: You Tube Channel launch

To all the DBS Economists out there, you now have your own 'You Tube' channel in which you can upload videos to educate the masses!!!

Here are Zara, Larissa and Paris with what I hope will be the first of many video clips from DBS students....



Mr Bentley

Y12 Economics - The Cobweb Theory

Following on from the theory session, check out this link which highlights real life supply issues...

Economics - Nature of Supply

Y13 Economics - Great video on BA and Iberia merger

Following on from the article we read in class yesterday, check this video out. The guy even talks about the 'Synergies' that are going to occur because of the merger....

GSCE Economics - Great video on BA and Iberia merger

A2 Economics - BA and Iberia - economies of scale

A useful piece on the recent merger activity between BA & Iberia (Year 13's...a must read!)

GSCE Economics - BA and Iberia - economies of scale

GSCE Economics -Youth unemployment

What will the situation be when you guys gracduate....lets hope it's better than this.....

GSCE Economics - Bit of fun on a Saturday morning - Youth unemployment

HOMEWORK YR 11 MRS RICHARDSON

Click on the link to access a past exam paper.

Answer all questions on pages 1 - 7 ONLY.
You may print out the rest of the paper as we will be going through this in the next few weeks.
Due date: Monday 16/11/09 period 5.

https://share.acrobat.com/adc/adc.do?app=org

GSCE Economics - Unemployment special

Click on the link and lets solve world unemplyment....

GSCE Economics - Super Starter Sunday - Unemployment special

I love this! Marketplace Public Radio convened a “Small Townhall” with eight middle school aged kids to ask them questions about the economy. The idea is that the economic decisions made by today’s business leaders, policymakers, academics and grown-ups in general will have huge effects on today’s youth when they grow up, so why not ask them what they think of the big economic issues today?

It is true that governments national debt could be described as a “teenager tax” since it will ultimately be paid back through higher taxes by income earners in the future. Well, these kids are those future income earners.

The questions the kids are asked:

1. Should kids be allowed to have credit cards?
2. Do you know what the recession is?
3. What is the deficit?
4. Has the recession changed your dreams?
5. What do you think about debt?
6. Do you have any investment advice?
7. What do you think about saving money?

Here are a couple of answers to questions...could you guys do any better???





Mr Bentley

Price Elasticity of Supply

Excellent notes on Price Elasticity of Supply

Microeconomics - Price Elasticity of Supply

Economics - GlaxoSmithKline and Pfizer choose to collaborate on HIV drugs

Oligopolists acting together to benefit themselves and the public.....ie collusion is not always bad..discuss??

Click on the link....




Economics - GlaxoSmithKline and Pfizer choose to collaborate on HIV drugs

Year 10 homework

Please click on the link below & complete the questions I said in class. To be handed in on Thursday 12th November.

https://share.acrocomcontent.com/adc/src/Jun+06+Unit+1.pdf?nodeId=8165402a-001b-4d32-974b-b91799a95178&key=xFRXzvku6yvy46cAfbO4Ss%2BJNPjwzTmL8sOUKnMvWdO7HXtWwqnTF7xxawCeN82wluvZJ%2FSJ65Hg%0AOz8BFoGOb3mhQqObqbJKnz2dpCMXpEXfRoiAUuhjAKIKyO7eMTM5sLDHiLdnJFnLW6UD%2FENZf05Z%0ADX8T1MoBnGwyIeJOJBwOBLOuEAjwZwkCwFhV70sA

Regulation: OFWAT plans to turn the tap on water company prices

Interesting article on the Water Regulator....please read for discussion in lesson;

Economics - OFWAT plans to turn the tap on water company prices

RPI - X explained

RPI-X and Natural Monoplies explained...with some wind in the background!!!

http://www.youtube.com/watch?v=dWuoVqhXlTI

Mr Bentley

Successful advertising - Supply, demand and price.

Clic on the icon and see this years 'Christmas Toy'. It just shows how a successful ad campaign can help create a revenue phenomenon!

Business Studies - Meerkat finds marketing “simples”



Check out one of the ads....



Mr Bentley

Electricity Markets & Regulation

Extension activity; the following powerpoint presentation discusses why & how any countries electricity is regulated. Please take some time over the weekend to have a look at the slides so we can discuss in next weeks lessons.

Electricity Markets Regulation - Lesson 1 - Regulation General Principles

View more presentations from Hans De Keulenaer.

Microeconomics - Privatisation & De-regulation

Lesson Plan for Y13 - Regulation

Learning Objectives: To embed knowledge of regulation and apply this to real world examples.

Watch the clip on water regulation...



The clip highlights the difficulties faced by the government watchdogs.

The following tag will provide further real world examples. I advise all year 13 students to print out the following. It is something we will refer to in class over the next few weeks as we attempt the many past case studies on this topic.

Microeconomics - Privatisation & De-regulation

Mr Bentley

Unit 1: Market forces are forcing up the price of chocolate

There is an excellent article in the Times today (Struggles of Ivory Coast’s cocoa farmers are set to force up the price of chocolate - Times Online) about the surge in the world price of cocoa.
Cocoa prices have hit a 30-year high as poor weather threatens to drive the price of chocolate up again for Western consumers.



Cocoa has reached $3,412 a tonne in New York as concerns deepened about demand outstripping supply for the first time since 1968.

This is a really good article to use to consolidate students’ understanding of how shifts in supply and demand can lead to price volatility. And also the importance of price elasticity of demand and supply in shaping price changes.

“The surge in price also indicates that cocoa is increasingly being used for financial investment rather than merely sold to industry”

* What factors are limiting cocoa supply?
* Why is demand from western economies rising - even though many are still in recession?
* Will cocoa farmersd necessarily gain from higher world prices?

Mr Bentley

BAA agrees Gatwick airport sale (Regulation and Efficiency)

It finally looks like Gatwick Airport has been sold. Click on the link below for more information.

BBC NEWS Business BAA agrees Gatwick airport sale




This could easily be an article in the A2 Unit 3 paper in January. Points for discussion;

1. What are the issues with BAA having 'a monopoly over so much airport capacity in the south east'?

2. What advantages will the customer expect to see with the break up of this 'Monopoly'? (specifically, what sort of efficiency gains could you expect to see?)

3. What are the possible disadvantages of forcing BAA to sell Gatwick?

Mr Bentley

The role of advertising in determining price elasticity of demand | Welker's Wikinomics Blog

An excellent article from an external blog discussing how advertising can impact on elasticity of demand.

The role of advertising in determining price elasticity of demand Welker's Wikinomics Blog

Y12 Elasticity and its applications

This week we will be using the knowledge you have learnt and applying this to real life situations, an essential skill for examination success.

Lesson 1: Review of elasticity, definitions, equations and diagrams.

Highlight any issues you have on the 'elasticity mind map' I have handed out.

Price Elasticity of Demand

The quantity demanded of a good is affected by changes in the price of the good, changes in prices of other goods, changes in income and changes in other relevant factors. Elasticity is a measure of just how much the quantity demanded will be affected by a change in price, income, price of other goods etc..

If the price of steak increases by 1% and the quantity demanded then falls by 20% we can see there has been a very large drop in the amount demanded in comparison to the change in price. The price elasticity of demand for steak is said to be high.

If the quantity of steak demanded was to only fall by 0.01%, we can see this is a fairly insignificant fall in quantity in response to the 1% increase in price. In this case the price elasticity of demand for steak is low.

It can be calculated using the following formula:

percentage change in quantity demanded
percentage change in price

(To help you remember quantity is on top of price think of the football team QPR). The table below shows a number of calculations of price elasticity of demand.

Demand is price elastic, if the value of elasticity is greater than one. If demand for a good is price elastic then a percentage change in price will lead to an even larger percentage change in the quantity demanded. For example if a 10% rise in the price of CDs leads to a 20% fall in the demand, then price elasticity is 20% / 10% or 2 and the demand for CDs is therefore elastic.

Demand is price inelastic, if the value of elasticity is less than one. If the demand for a good is inelastic then a percentage change in the price will bring about a smaller percentage change in the quantity demanded. For example if a 10% rise in price by rail company resulted in a 1% fall in train journeys made then price elasticity would be 1% / 10% or 0.1 and the demand for rail journeys is therefore inelastic.

Special Cases of Elasticity

Demand is infinitely inelastic if the value of elasticity is zero (zero divided by any number). Any change in price would have no effect on the quantity demanded.

Demand has unitary elasticity if the value of elasticity is exactly 1. This means that a percentage change in the price of a good will lead to an exact and opposite change in the quantity demanded. For example a good would have unitary elasticity if a 10% increase led to a 10% fall in the quantity demanded.

Demand is infinitely elastic if the value of elasticity is infinity (any number divided by zero). A fall in price would lead to an infinite increase in quantity demanded (i.e. increasing from zero), whilst an increase in price would lead to the quantity demanded falling to zero.

The case of unitary elasticity is the curve (known as a rectangular hyperbola). The perfectly inelastic curve looks like an I and the perfectly elastic curve looks like an E (without the top!).

Knowing these special cases it makes it easier to spot whether a demand curve is relatively elastic or inelastic. The demand curve on the left is relatively elastic (as it looks more like the E) and the demand in the centre is relatively inelastic (as it looks more like an I).


Changes in Elasticity Along the Demand Curve

We mentioned earlier that a good is infinitely elastic if a fall in price leads to an infinite rise in quantity. This must occur if quantity was previously zero and rises to in response to a fall in price - this can be seen at the top of the demand curve.

The opposite occurs at the bottom of the demand curve leading to an elasticity of zero.

Also shown on the diagram is the point where elasticity is unitary (equal to one), this by definition occurs exactly halfway along the demand curve.

If elasticity is infinite where the demand curve crosses the price axis, but is equal to zero when it crosses the quantity axis, then elasticity must change as you move along the demand curve. Demand is price inelastic if it has a value less than 1 and elastic if greater than 1, these regions are shown above.

Importance of elasticity for a business

If the business is producing on the price elastic section of the demand curve, a small percentage change in price leads to a large percentage change in quantity demanded. Lowering the price will have the effect of increasing total revenue and raising the price will decrease total revenue, e.g., if the price of Mars Bars increased by 25% ceteris paribus, we would expect their sales to fall dramatically as consumers shift to other chocolate bars. This would have the effect of reducing their total revenue.

If the business is producing on the unitary price elasticity section of the demand curve, small changes in price do not change total revenue as a percentage change in price will be exactly offset by an inverse change in quantity.

If the business is producing on the price inelastic section of the demand curve, a small percentage change in price leads to a small percentage change in quantity demanded. This will have the effect of decreasing total revenue when the price is increased and increasing total revenue when the price falls. For example if a firm invented a miracle cure for the common cold and decided upon a price of 50p a pack. The firm sold 10 million packs in the first year of sales. Next year they decide to raise prices by 25% and sales fall to 9 million (10% fall), the level of sales have dropped, but the total revenue has increased.

It is important to note that the revenue maximising level of production occurs when elasticity is unitary, but this isn't necessarily the level where profit is maximised. We don't know the firm's costs at different levels of output. Furthermore elasticities are notoriously difficult to calculate and errors in the elasticity figures could lead to incorrect pricing decisions.

Factors Affecting the Price Elasticity of Demand

Two factors are usually highlighted by economists:

The availability of substitutes. If a product has many substitutes then its price elasticity is likely to be high. An increase in price will lead to consumers shifting demand to one of its many substitutes (e.g., chocolate bars). However if the good has few substitutes, consumers will find it harder to replace that good, so its price elasticity is likely to be low (e.g. salt).The more widely a product is defined the fewer substitutes it is likely to have. Spaghetti has many substitutes, but food has none.

Time. The longer the period of time, the more price elastic is the demand for the product. For example if the price of leaded petrol was to increase by 50% my demand for it would not change in the shirt run. However as time goes on I would change my car to one that used unleaded petrol, therefore in the longrun elasticity becomes greater.

Attention all Economists!!

Click on the clip..essential material for all economists;



Mr Bentley

Assessment Objectives and Command Words - Study Skills

Click on the link below to access an excellent piece on study skills and examination technique. Excellent for Business & Economics at all levels.

Assessment Objectives and Command Words - Study Skills

Year 12 - Consumer surplus notes

Following on from the work we completed in class, here are some notes on consumer surplus.

Applying the concept:

Having completed the exercise, discuss in groups the following questions.

How could the concept of consumer surplus contribute to arriving at a decision to build a new by-pass through an area of outstanding natural beauty or a site of special scientific interest?

How might consumer surplus help us to understand why companies who exercise market power and maintain price above the equilibrium level be deemed as being 'against the public interest'?

How might a government or the EU attempt to justify paying subsidies to a business or industry?

What might be the limitations of using a concept like consumer surplus in decision making - try to think of relevant examples.

Mr Bentley

Year 13 - Contestable markets

You need to fully understand why firms decide on strategies other than 'Profit Maximisation'. We will be covering the following in class;

Elasticity - Mind Map

Y10/12 Economists - Crazy clip on Elasticity

A 6 minute clip (with some dodgy music track), may help....It covers all 4 types of elasticity required for IGCSE and 'AS' level;



Mr Bentley

Year 10 & 12 Economists

A useful diagram to print & paste into your exercise books.....(click on it to enlarge.

Also, click on the link below to access the homework for this week. This is your first serious test. Answer all the questions (1-9) in your exercise book. Hand in the following Wednesday:

http://www.bized.co.uk/educators/16-19/economics/markets/activity/demandsupply.htm

Mr Bentley

Year 10 & 12 Economists

Great clip on determinants of demand...



Mr Bentley

Year 13 economics - Game Theory

A really good clip on game theory. Please take 8 minutes out of your day to watch it. Please bring your questions to the class...



Mr Bentley

Interactive timer

Interactive timer

Shared via AddThis

Shifts in Supply & Demand

Check out the clip on shifts in Supply & Demand



Mr Bentley

Determinants of Demand

Check out the clip on determinants of demand...




Mr Bentley

Year 10 & 12 Economics Homework task

Click on the link below and follow the instructions.

This will be revision for a half of year 12, but worth doing anyway. Year 10, this is all new to you, so be careful when answering questions.

http://www.econedlink.org/lessons/index.php?lesson=EM550

Please hand in first lesson after the weekend!

Y11 Business Studies - Homework

http://www.bized.co.uk/educators/16-19/business/hrm/activity/motivation.htm

Year 11 Business,

please access the link above, which has the homework task. You must complete EITHER activity A or Activity B and hand the work in on the first lesson back after the holiday (Wednesday).

Mr Bentley

Y10 Economics - Homework

Year 10,

please complete the following for homework:

Text book page 36, Exercise 6 - 'Spicy scandal in giant jars', answer ALL questions in your exercise book.

The work must be handed in on the first lesson after the holiday (you have one week).

Mr Bentley

Y12 Economics Homework

You will find the homework on the school shared area (student data - under Economics).

Please print out and complete for the first lesson after the holiday. These are past AS level questions and should be treated as such. I expect definitions to be accurate and answers to be neat.

Mr Bentley

Y13 Economics - Monopoly

The clip we looked at in class....




Mr Bentley

Y11 Business Studies - Motivation

An important aspect of business is how to best motivate your workforce. The two theories you must be aware of are 'Maslow' and 'Herzberg'.

Y13 Applied Business - Gannt Chart Tutorial

Check out the clip below on Gannt Charts. Essential for successful project management ;




Mr Bentley

Y10/12 Economics - Production Possibility Curves

Check out the 7 minute clip which helps explain PPC's in relation to school work. Very helpful, so please watch this week and we will discuss in class.


Mr Bentley

Y13 Economics - Perfect Competition

Have a look at the following Presentation on Perfect Competition. It describes all aspects required for the examination in simplistic terms. Any questions, please either comment, or ask me in class.

Perfect Competition

Uploaded on authorSTREAM by varun23oct | Upload your own presentation

Mr Bentley

Y11 Business Studies - Homework

Following on from the work you have done on recruitment, answer the following simple exam questions;

1. State 2 possible reasons why a business would want a prospective employee to produce a curriculum vitae (CV) (2 Marks)

2. Identify 1 reason why the layout of a CV is important. (2 Marks)

3. Explain how this reason will help an employer in the recruitment process for a new employee? (3 Marks)

This must be finished by tomorrow (Thursday 10th).

Y13 Economics - Homework

Hello all,

please have a look at the link below and complete the tasks required. You have until Wednesday 16th...enjoy!

http://www.bized.co.uk/educators/16-19/economics/firms/activity/costs.htm

Y13 Economics - Cost Curves Presentation

Click on the link for a presentation on cost curves...


http://www.tutor2u.net/economics/presentations/a2economics/micro/Costs/default.html

Year 12: Intro to Economics

Have a look at this short clip. It should help explain what economics is all about....



Mr Bentley

Y10 Economics - Homework task

The economy is faced with three key questions that have to be answered

1. What goods and services should be produced? Should the economy focus on being self-sufficient or concentrate on what it is good at? Should it devote resources to health and education or defence and policing? Should we devote more resources to housing? Should an economy use resources producing goods that are essentially useless - like 'free' toys in cereal packets, football sticker cards and so on?

2. How should goods and services be produced? Should the economy use a system that is labour intensive, thereby ensuring everyone who wants a job has one, or should we use more efficient methods of production that involve the use of machines, even if this means more pollution and fewer jobs? Should we devote more land to production and thus solve some problems of feeding the population at the expense of encroaching into areas of natural beauty?

3. Who should get the resources that the economy has produced? Should an economy be geared to providing goods and services to every person as equally as possible or should those who work hard get more? How do we distribute our resources?

Your Task

• Make a list of answers to these questions - think of the answers in general terms rather than specifics, e.g. food, health, etc.

1. What should be produced?

2. How should these goods and services be produced?

3. Who should get what is produced?

Only spend 20 minutes or so on this and write your answers in your exercise books. Have a great weekend,

Mr B

Y13 Economics - Integration

Have a look at the following clip which helps explain Horizontal Vs Vertical Integration. We will discuss this on Sunday, enjoy your weekend!

Mr Bentley

Michael Jacksons Pepsi Ad

Check out the pepsi ad done by Mr Jackson..example of advertising economies of scale???

Also, we may use Jackson to discuss cash rich Vs asset rich.

Watch this space!

Premier League winners 2009/10???

Welcome to the DBS Business & Economics Department

Hello all,

Yep, its that wonderful end of the summer holiday when we all cannot wait to get back to Economics & Business Studies!!

We will try and make the year an exciting and enjoyable one for you all and I am pleased that you have found your way to the new DBS blog site for this academic year.

The site will have all sorts of information ranging from homework assignments and subject specific notes, to examination questions and 'you tube' clips.

I aim to make the site interactive and I hope you will leave comments on articles of interest. It will also include voting/ranking of certain issues, not always linked to the 'fascinating world of Business & Economics'. For example, have a look at the blog post below re UK football and have a vote!

Anything to get you guys talking will help you with your studies this year. I addition, the site will be the home of the new DBS debating society. More information on that over the next few weeks.

Enough for now, see you in class.

Mr Bentley

PS Can anyone tell me who the guy in the pictuure is...not the cartoon, the other one!