Hi Geoff, at 40:20 it was mentioned how international competitiveness could be a 25 marker on the paper 3. Would a suitable microeconomic policy be lowering the minimum wage in order to decrease ULCs and attract FDI? Would I have to develop my analysis differently if I used it as a micro policy?
Hi Geoff, I have a question about corporation tax. I know that practical application and theory state that increases in cooperation tax will shift AD to the left on an aggregate level due to reduced business investment. However, could you evaluate this by saying some firms (specifically small firms which can act more quickly e.g. sole traders) may actually increase investment within the same tax year to avoid making more profits as more will just be taxed by the government so the increase in AD would likely not be as significant?
and that it where the government's permanent 100% capital allowance comes in - a small firm can bring forward £50,000 for new machinery / tech etc and get 19% tax relief off that spend. Overall however, a 25% rate for larger companies is likely to cut planned investment or shift it to other countries.
Hi Geoff, at 40:20 it was mentioned how international competitiveness could be a 25 marker on the paper 3. Would a suitable microeconomic policy be lowering the minimum wage in order to decrease ULCs and attract FDI? Would I have to develop my analysis differently if I used it as a micro policy?
I'm always wary of suggesting cuts in the minimum wage as fundamentally it does not improve competitiveness.
Hi Geoff, I have a question about corporation tax.
I know that practical application and theory state that increases in cooperation tax will shift AD to the left on an aggregate level due to reduced business investment. However, could you evaluate this by saying some firms (specifically small firms which can act more quickly e.g. sole traders) may actually increase investment within the same tax year to avoid making more profits as more will just be taxed by the government so the increase in AD would likely not be as significant?
and that it where the government's permanent 100% capital allowance comes in - a small firm can bring forward £50,000 for new machinery / tech etc and get 19% tax relief off that spend. Overall however, a 25% rate for larger companies is likely to cut planned investment or shift it to other countries.
please can you do a labour markets session
before paper 1
Good idea - thanks - we did some in 2023 (check out the 2023 revision livestreams)
for an industry of your choice, does it have to be UK or can it be international
is this for the Edexcel A exam board?
Yes