Command, free markets and mixed economies-diferences

There is a scale of how much control the govenment takes over the economy, measured in three factors: Command economies, Mixed economies or a Free market.

Command economies:

Put simply, these economies are mostly controlled by the govenment. The govenment will control the allocation of the resources, what is made and so on. An example of a command economy would be North Korea, as the govenment has high control over production. This means that there is not a high amount of variety in there markets. These economies can go into Govenment Failure, as the govenment is controlling the whole market. And when the govenment makes the wrong decision, this is when the market begins to collapse, with the govenment getting the blame.

Free markets:

This is the complete opposite of a command economy, because the people who are in charge of production (managers etc.) control what that certain company makes. This will give a variety of what goes on the market. An example of this is Hong Kong-it's markets are completly different to ones you find in North Korea. These countries are highly unlikly to go into Govenment Failure, as the government does not control as much of the economy as in a command economy (e.g.: North Korea).

Mixed economies:

These are 'in the middle' of a command economy and a free market. They are partly controlled by the govenment, and partly controlled by the managers of the companies controlling production. This has a variety of items on the market, but what goes on can be controlled by the govenment. An example of a mixed economy would be the USA. If the market begins to collapse, then who to blame is questionable (i.e. who controlled that part of the market, the govenment or the the manager of the company).

iPhone 5 record orders

As many of you will know, the iPhone 5 was released about a week ago, and has already had 2 million+ orders in 24 hours, meaning some will not arrive until October.

The full article is here: http://news.sky.com/story/986160/iphone-5-delivery-backlog-after-record-orders, but here are my thoughts on why this is:

• New Operating system coming out with turn-by-turn navigation (Available shortly).
• 4G Internet-faster browsing and shorter download time.

Comparing prices (paying monthly):

iPhone 4 (32GB): £189-£239, £23-£26 per month.
iPhone 4S (32GB): £189-£239, £27-£30 per month (64GB: £279-£329, £27-£30 per month).
iPhone 5 (32GB): £89, £37-£39 per month (64GB: £109, £40-£42 per month).

Therefore (using the 32GB model), The iPhone 5 is a lot cheaper when you pay the upfront cost (i.e. what you give to the store), but has a higher monthly cost (i.e. what comes to you as a bill per month).

So why does has the new iPhone sold out so quickly? Well, it seams that it is because it is cheaper and that system that it runs on is a lot faster than previous iPhones, which attracts both current iPhone fans and new ones. The turn-by-turn navigation should make driving a lot easier, and may even start to replace sat navs. The 4G Internet (fastest yet) makings browsing the Internet, downloading videos etc. will make browsing the Internet a much more pleasurable experience (without the horrible loading screens and waiting for videos to buffer can be time consuming).

So can the iPhone 5 reach the top of the smart phone market, once Apple can sell the 2 million+ orders they've received in their first few days of selling? And will the turn-by-turn navigation begin to start replacing the sat nav systems? Well, only time tell.

Facebook shares on the rise

 

For the first time in a while, Facebook shares have risen. Over the past month or so, the shares have continued to decrease in value, possibly due to other Social networking sites gaining more popularity (e.g.: Facebook users not liking the new timeline and/or chat system). The graph opposite shows the change in Facebook shares from May 18th until September 12th.

Over the past 8 days (Sept. 4th to 12th), Facebook shares have increased in value by 118%, from $17.73 per share upto $20.93 per share, which is an increase of $3.2 per share. Facebook shares made a large increase since the interview with Mark Zuckerburg on Tuesday (12th Sept.). The interview was to 'calm down' worried investers in the company.

As of September 12th, Facebook shares are worth $20.93, which is 55% of what they were worth when trading first begun, and 46.5% of their peak in value.

The most popular features of Facebook are searches, finding friends and using apps. These features are constantly being updated to gain more popularity and make them easier to use.
Since the release of Twitter and Google Plus, Facebook has had competition to be the best Social Networking media on the Internet. Now can Facebook bring up it's share values and increase the number of people that use it, and still be the dominant socal networking site? Only time will tell. Maybe Zuckerburg's speech has been the turning point of Facebook's history.

Murray's win at the US Open

As many people will know, Andy Murray has won his first Grand slam title at the US Open. So what does this mean on the economic side? 'On the economic side' could (in theory) mean anything from Murray's income to an entire country or the world. I'm going to write about Murray's income, and also compare it to another Tennis player, Roger Federer (World Number 1).

Murray was estimated to earn $12 million (£7.5 million) in the last 12 months, which is not much compared to Roger Federer, who earned $54.3 million (£33.37 million), which is about 22.1% of Murray's earnings. The $1.9 million (£1.18 million) that Murray earned for winning the US Open is equivalent to 15.8% of Murray's earnings in the past 12 months, and a small 3.5% of what Federer earned last year.

With this win for Murray, he should be attracting a lot of sponserships, possibly increasing his earnings to nearly $20 million (£12.44 million). This means he could possibly earning three times as much as he is currently earning, 36.8% of Federer's earning last year.

Now with his first major win and an Olympic Gold in the Men's singles, then this will surely give Murray more confidence, which will therefore increase his earnings, so 'Brand Murray' can only increase.

The question that I asked at the start was 'What does this mean on the economic side?'. Well, I can conclude that Murray's earnings as 4th in the World Tennis Rankings are considerably less than the Federer. However, Murray's earnings are set to increase, as of the rise in Sponserships that he should gain. Now this should mean that he should win more Grand Slam titles. But, if his performance drops, then he may loose those sponserships will (possibly) fade away, and Murray will be back to where he started before he won the US Open. So the pressure that was on Murray when he came to the final was high (due to the fact that there had not been a British player to win a Grand Slam in 76 years), but he cannot completely relax- he still needs to keep up his current level of performance to secure these Sponserships by winning more Grand Slams or other titles.

The first blog

So, this is my first blog. I've created the blog so that I can post economics-related links and anything I've found relevant or interesting. I hope this will help me though the course this year and that it will help everyone else.