Search & Filtering
(f) With the aid of a well labelled diagram, carefully explain the impact on the
money market if there was a discovery of gold that fuels inflation. (5 marks
what is a multiplier
1. Below is a production possibilities table for consumer goods (automobiles) and capital
goods(forklifts):
Type of Production Production Alternatives
A B C D E
Automobiles
Forklifts
30
2
27
4
21
6
12
8
a. Show these
data
graphically.
Upon what
specific assumptions is this production possibilities curve based?
b. If the economy is at point C, what is the cost of one more automobile? Of one more
forklift? Explain how the production possibilities curve reflects the law of increasing
opportunity costs.
c. If the economy characterized by this production possibilities table and curve were
producing 3 automobiles and 20 fork lifts, what could you conclude about its use of
available resources?
d. What would production at a point outside the production possibilities curve indicate?
What must occur before the economy can attain such a level of production?
Suppose that 20,000 of the employed switches to jobs in the underground
economy. When interviewed by STATIN, 50% of these switchers report that they
are not working and not seeking work, while the other 50% report that they are
not working but seeking work. Explain what happens to the official
unemployment rate and the “true” unemployment rate. (2 marks)
can redistribution occur during inflation?
Why are million of people unemployement
The inflation rate is...
hich of the following explains why redistribution occurs during inflation?
a) Rising prices fail to signal desirable changes in the mix of output.
b) Because all prices do not change at the same rate, people buy different combinations of goods and services and own different combinations of wealth.
c) Relative prices remain unchanged.
d) All loans are indexed to inflation
Given the information in the extract, the Simple Keynesian Macroeconomic Model concludes the following
about the South African economy in 2006. (4 marks)
a) Excess demand
b) Excess supply
c) Macroeconomic equilibrium
d) Aggregate spending is less than output
“Periods of economic instability” are in line with which of the following views of the business cycle?
