Macroeconomics Answers

Over the past few years, quite a number of private loan companies have been

established globally. What impacts do you think the pandemic is having on

these kinds of companies?

Indicate under which item of the current account each of the following transactions is

recorded and whether it will increase or decrease the balance on the current account.

a. Capeson, a Chadilien exporting company, exports fruit to the Middle East.

If Qd=20,000-3P Qs=15,000+2P. Calculate equilibrium price and quantity.

Calculate price elasticity of supply using point elasticity method. Also interpret the result.

Indicate under which item of the current account each of the following transactions is recorded and whether it will increase or decrease the balance on the current account. 

a. Capeson, a Chadilien exporting company, exports fruit to the Middle East. (2 Marks)

b. Jones and Kelly, a Chadilien engineering firm, hires German engineers to help with the construction of new stadiums. (2 Marks)

c. You receive a dividend (a part of the profit) because you own some shares in Amazon which is based in the US. 

Suppose there is a permanent increase in total factor productivity (i.e., both current productivity and future productivity rise). Determine the equilibrium effects of this on current aggregate output, current employment, current real wage and interest rate, current consumption, and current investment. Show how the impact differs from the case where total factor productivity increases only in the current period. Explain your results.

Indicate under which item of the current account each of the following transactions is

recorded and whether it will increase or decrease the balance on the current account.

a. Capeson, a Chadilien exporting company, exports fruit to the Middle East. (2 Marks)

b. Jones and Kelly, a Chadilien engineering firm, hires German engineers to help with

the construction of new stadiums. (2 Marks)

c. You receive a dividend (a part of the profit) because you own some shares in Amazon

which is based in the US. (2 Marks)

COECB1-B44 – Take-Home Assessment Paper Block 4 2021 | V1.0 Page 5 of 7

d. You inherit some money from your deceased aunt who lived in London

In the simple circular flow of economic activity, goods, and services flow via:

consider the following information : consumption C=800+0.8Yd, tax rate t=30%, investment I=600, Government Expenditure G=800, Export X= 400, Import I=200+0.2Y, where Y= national Income and Yd= disposable Income

Find the equilibrium Income

Find the value of multiplier

Find the value of consumption at Equilibrium

What is the value of import at equilibrium

What is the value of savings at equilibrium

What is the value of budget surplus

What is the value of current account

Other things remaining the same if investment increases from 600 to 664, the change in equilibrium income is

Other things remaining the same , if tax rate increases to 50%, then the new multiplier is

How does the relative income hypothesis rationalize the difference between the cross sectional and time series properties of consumption data.

a) How is money supply different in a fixed compared to a flexible exchange rate system? b) Explain why does monetary policy lose autonomy in a fixed exchange rate system ? c) Explain the assumptions of flexible exchange rate and fixed exchange rate. Which is an appropriate system for an small island economy of the Pacific ?