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The Economics Concept of Diminishing Returns

Diminishing returns is probably one of the most important concepts in Economic theory. It is so famous that it has now entered common everyday speech. Some people do get confused with diminishing returns but it is actually quite a simple idea.

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What are Economies of Scale: Examples of Internal Economies and External Economies

An important idea in economic theory is economies of scale. If it wasn’t for the existence of this phenomena it is doubtful that the world economy would look anything like it does today.  The reason large companies and multinationals exist is because they take advantage of economy of scale.

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How Game Theory Applies To Economics

Anyone who saw the award winning film “A Beautiful Mind” will probably have heard of “game theory”. This film was based on the true story of John Nash and his battle with schizophrenia. This inspirational figure managed to overcome his mental health problems to go on to win a noble prize. The prize was awarded for his contribution to economics in the form of John Nash game theory; in particular his idea of the Nash’s equilibrium.

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What is Keynesian Economics?

Those who listen to the financial news may have heard the term ‘Keynesian economics’ floated around. There may be some confusion as to what this is actually referring to. Discussions about the validity of this theory can become heated among economists so it is worth having some idea as to what is behind it all.  A basic explanation will be provided here.

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What is Economics…And Why Should I Care? Part 2

Yesterday, In Part 1 we discussed economics terminology as it relates to your household budget. Today, let’s create a real example of the terminology in action.

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What is Economics…And Why Should I Care? Part 1

Instead of giving you a definition of economics, I’m going to give you an example that works on a microeconomic level but also helps explain macroeconomics by way of analogy. This week, we will look at your home and household budget as its own economic ecosystem.

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Introducing Everyday Economics

Whenever people start talking about economics, something in the air changes. For most of us, the air becomes filled with a little buzzing noise that interrupts our train of thought and makes it impossible to actually understand what those trained economic savants are saying. Eventually, the buzz transforms into a completely formed thought–usually something along the lines of, “What should I make for dinner tonight?” Or, “I’ve got to pick up the dog from the vet.”

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What is Staggered Contracting, Recession Style

The concept of staggered contracting revolves around one primary topic: price. At a glance, staggered contracting seems like something only found in a parallel, Utopian dimension: prices don’t wildly fluctuate. In fact, under the definition of staggered contracting, prices don’t move at all in either direction.

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