
In economics too: maths at the heart of the system | Tangente
In economics too
In economics, as in everyday life, rates are everywhere. Let's see how.


In economics, as in everyday life, rates are everywhere. Let's see how.


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Our thinking seems naturally additive. If we add 10% and then another 10%, we expect the total to be 20%. Yet that is wrong! Rates are not added; they are multiplied. How can we avoid the pitfalls of percentages? How can we work out the cost of a loan?

Most developed countries have policies to help the poorest members of society. This raises the question of what we mean by "poor." Should the definition be absolute or relative? Should it refer only to income, or should assets and place of residence also be taken into account?

It is often useful to study the relationships between different economic quantities. One such question is how the quantity demanded of a good depends on its unit price…

Percentages are everywhere. Learn how to avoid their pitfalls.
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