Macroeconomics Answers

Which of the following will lower inflationary expectations?

An increase in the money supply.

The SARB announcement that it will steadily raise the repo rate.

The government's announcement that it will increase spending on infrastructure.

An increase in consumer and business optimism.

Which of the following statements describes the effect of the South African Reserve Bank selling government bonds?

1. The money supply decreases and the interest rate increases.
2. The money supply increases and the interest rate decreases.
3. There is a decrease in equilibrium output in response to the increase in the interest rate.
4. There is an increase in equilibrium output in response to the decrease in the interest rate.

II) only.

(I) and (III) only.

(II) and (IV) only.

(II) and (III) only.

1. Molly still has a $2500 down payment. How much loan does Molly need?
   

Explain, with the aid of a graph, what will happen to the exchange rate between the rand and the dollar if more South African residents purchase shares in American companies. Also comment on the impact on the equilibrium quantity of dollars.

You are given the following information about a closed economy with no government:

Consumption = 445 + 0.75Y

Investment = 250

Use the above information to answer the questions that follow:

Q.4.1 Calculate the value of autonomous spending

Explain, with the aid of a graph, what will happen to the exchange rate between the rand and the dollar if more South African residents purchase shares in American companies. Also comment on the impact on the equilibrium quantity of dollars

Explain, with the aid of a graph, what will happen to the exchange rate between the rand and the dollar if more South African residents purchase shares in American companies