Ceteris paribus, there is an inverse (negative) relationship between quantity demanded and the price of a good or service.
Weak pound → Price of UK Exports falls in foreign markets → UK exports increase → (X-M) improves → AD shifts right
Weak pound → Price of Imports in the UK increases → UK consumers import less → (X-M) improves → AD shifts right
-Lower interest rates
-Savings decreases
-More confidence
-High profits
-Gains in wealth
-Lower income taxes
-More Government Spending
-Weak currency
-Society attitude toward spending
The Greek and German economies had no 'convergence'
Greece had high unemployment and needed loose monetary policy.
Germany had low unemployment and needed tight monetary policy.
Two countries with different needs, using a common currency, causes stress.
No change in Demand curve.
Quantity Demanded increases (extension/ movement along Demand Curve)
-Economic Growth
-Increased productivity of the worker.
-Increased demand for the product the worker produces.
A system where both free market mechanism and government planning process allocate resources in society.
When demand for one product is driven by the demand for another product.
It will be leant out as a loan (though about 10% should be saved as shareholder capital).
