Great evaluation for base rate questions

First of all sorry for the lack of blogs this month, exam marking has reared its ugly head and taken over my life again.

Even so I saw this video and thought it is so important that I should post it. One of the most important factors for long answer questions at GCSE or A level is evaluation. Here is a fantastic one for how a reduction in the base rate may not have as big an effect on demand.

You would normally say a reduction in the base rate will reduce people’s mortgage interest repayments so they will have more disposable income which could lead to an increase in consumption shifting the AD curve to the right. Here is a great however...