economics of microtransactions
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Economics of Microtransactions in Video Games

The recent news of Electronic Arts' Star Wars Battlefront II video game revisited the controversial business model in the video game industry called microtransactions. The controversy erupted when u/MBMMaverick on Reddit reported that he had to spend $80 to unlock Darth Vader. EA's response to that thread didn't do them any favors. They suggested the system...
economic growth factors
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What is Economic Growth?

The economic growth of a country is the increase in the market value of the goods and services produced by an economy over time. We define economic growth in an economy by an outward shift in its Production Possibility Curve (PPC). Another way to explain growth is the increase in a country’s total output or Gross Domestic Product (GDP). It...
Factors of Production
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Four Factors of Production

There are four factors of production: land, labor, capital, and entrepreneurship. These four factors of production are used in the production of goods and services. These factors are limited, and there is unlimited human wants, we face a decision over the efficient allocation of these scarce resources or factors of production. Sometimes the type of economic...
Profit Maximization Rule
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Profit Maximization Rule

The Profit Maximization Rule states that if a firm chooses to maximize its profits, it must choose that level of output where Marginal Cost (MC) is equal to Marginal Revenue (MR) and the Marginal Cost curve is rising. In other words, it must produce at a level where MC = MR. Profit Maximization Rule Formula The profit...
the multiplier effect
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The Multiplier Effect

The Multiplier Effect is defined as the change in income to the permanent change in the flow of expenditure that caused it. In other words, the multiplier effect refers to the increase in final income arising from any new injections. Injections are additions to the economy through government spending, money from exports and investments made by...
Production Possibilites Curve
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Production Possibilities Frontier

The best way to show a country's available resources and the maximum two goods produced from those resources is a Production Possibilities Frontier (PPF). Production Possibilities Curve (PPC) is another name for the Production Possibilities Frontier. One of the first things to note is that, often Economists make assumptions in models; such as "ceteris paribus" meaning...

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