Notes, summaries, assignments, exams, and problems for Economy

The IRPF (Personal Income Tax) is proportional and progressive, meaning that those who earn more, pay more. This is based on tax brackets applied to the taxable base.

Business Aspects: Partnerships, Capital, and Taxation

Key considerations include the number of partners, minimum capital requirements, type of liability, and taxation. It is generally more beneficial to optimize tax strategies.

Freemium Business Model

Freemium is a pricing strategy where a product or service is provided free of charge, but users are charged for additional features, services, or virtual/physical goods. This model has been used in the software industry since the 1980s. A subset used by the video game industry is called free-to-play.

Example: The accountingtools.com website... Continue reading "Understanding IRPF, Freemium, and Marketing Strategies" »

Unit 1.6: Growth and Evolution

Economies of Scale

• The long-run average costs fall as more output is produced.
• The idea of getting bigger is cheaper.
• When the costs of a business go down as the business grows.

Internal Economies of Scale

• Purchasing: The price is lower if you buy in large quantities.
• Financial: Big businesses are seen as less of a risk than smaller businesses.
• Managerial: They have specialized managers in the different areas which brings costs down as efficiency rises.
• Technical: Only big businesses can afford to buy the best technology, which in the long run brings down costs.
• Marketing: Large-scale businesses are the ones who can afford and spread the cost of the most effective and expensive types of marketing.

External Economies of Scale

• Consumers:

1. Net Income

The net income is rising from 2015 to 2017, which is good. However, net income as a percent of sales rises from 2015-2016, but falls from 2016-2017. Why?

2. Total Revenue

Total revenue is increasing each year from 2015 to 2017, which is good. On a percentage basis revenue increased by 27% from 2015-2016 and accelerated to 31% in 2016-2017, which is very good.

3. Cost of Revenue

Cost of revenue is going up from 2015 to 2017, which is to be expected because revenue is going up. On a percent of sales basis, cost of revenue is going down each year from 67% to 62%, which is very good.

4. Gross Profit

Gross profit is rising over time from 2015 to 2017 which is good. As a percent of sales it is getting better over time, which we expected because... Continue reading "Financial Analysis: Trends and Concerns" »

1929 Crisis: Stock Market Crash

1. The Booming Twenties

• After WW1, a period of peace emerged.
• Countries experienced economic growth.
• The League of Nations aimed to prevent wars.
• The Dawes and Young Plans aided Germany's economic recovery and reintegration into the League of Nations.
• The US provided financial assistance to Europe for post-war recovery.

The US appeared prosperous with high production, wages, and cheap labor. However, many lived in poverty. European countries imposed tariffs on US imports to protect domestic products. Overconfidence led US citizens to borrow money to buy shares, despite low share prices. European countries grew wary of the US.

Germany borrowed heavily for post-war reconstruction, but it wasn't enough. France occupied... Continue reading "1929 Stock Market Crash: Causes and Effects" »

Types of Primary Research Methods

Questionnaires

A questionnaire is a set of questions used to collect data for market research.

Advantages:

• Detailed qualitative information can be gathered.
• Customer opinions can be obtained.
• They can be carried out online.
• Vouchers can be offered to encourage participation.

Disadvantages:

• Inaccurate answers may result from poorly designed questions.
• Can be time-consuming and expensive.
• Collating and analyzing answers is time-consuming.

Online Surveys

Online surveys require the target sample to answer questions over the internet.

Advantages:

• Quicker response times.
• Cheaper than interviews or postal questionnaires.
• Easy for participants to complete.
• Data can be quickly analyzed using IT tools.

Disadvantages:

• Lack of an interviewer

PROFORMA INVOICE

It is a document without taxes value, the seller provides it to the buyer, contains most of the necessary information about an international operation. If the buyer accepts, it is understood that the buyer accepts and confirms the information indicated on it.

Freight Transportation Fundamentals

Importance of an Effective Transportation System

• Greater competition
• Economic Scale
• Reduced price

Service Choices and Their Characteristics

• Price
• Transit time and variability
• Loss and damage

Transportation Rate Profile

1. Volume related rates
2. Distance-related rates
   • Uniform rates
   • Proportional rates
   • Tapering rates
   • Blanket rates: meet the rates of competitors
3. Demand-related rates: Transportation rate is set by competitor

Transportation Charges

• Line-haul rate
  • By products
  • By shipment size
  • By route
  • Miscellaneous rates
• Special service

Line-Haul Rates

1. By products
   • Classification system was devised (T 6.4)
   • Class rates: once a product has a freight classification, line-haul charges can be determined. Zip codes are used for the location (T 6.5)
   • Break

Desirable Qualities:

• Dedicated (works very hard at something that is important to them)
• Dependable (is always there when you need them)
• Enthusiastic (is interested and excited about things)
• Kind (is nice, friendly, and generous)
• Optimistic (has a positive attitude to life)
• Outgoing (likes meeting and talking to new people)
• Sensible (is practical and rational)
• Supportive (gives you help when you are having a difficult time)
• Sympathetic (cares about other people's problems)
• Truthful (is always honest)
• Sensitive (understands other people's feelings or is easily offended)

Jobs:

• Clothes shop assistant
• Farm helper
• Hotel receptionist
• Summer camp monitor
• Supermarket cashier
• Waiter

Vocabulary:

• Character Adjectives: active, confident, dedicated, punctual, reliable, sociable
• Compound:

What is Economic Growth?

Economic growth refers to the increase in the production of goods and services within an economy, typically measured over a long period, such as a year. It is expressed as a percentage increase in the real gross domestic product (GDP), which accounts for inflation.

Calculating GDP

There are two primary methods for measuring an economy's total production:

1. Expenditure Approach: This method sums up all spending on goods and services by households, businesses, governments, and foreign entities. The formula is GDP = C (consumer spending) + I (investment spending) + G (government spending) + (X - M) (net exports).
2. Income Approach: This method calculates the total income earned by all households within a nation.

The Expenditure