Macroeconomics Answers

Which of the following will cause a shift in the short run aggregate supply curve? 

(i) An increase in the full employment quantity of labour. 

(ii) An increase in GDP. 

(iii) A decrease in money wage. 

(iv) A change in personal income.

Only ii and iv.

i, ii, iii and iv.

Only i, ii and iii.

Only i and iii.

Which of the following events would not involve a supply shock that would shift the aggregate supply curve? 

(i) The Cosatu union disintegrates and the minimum wage is abolished. 

(ii) African bank plc’s bad debt creates a financial crisis and that leads to reduction in money supply. 

(iii) 2016 drought destroys half of the crops farmed. 

(iv) A tax on sugar is levied on companies that produce sugary beverages.

Only iii and iv are correct.

Only i and ii are correct.

Only ii is correct.

Only ii and iv are correct.

Which of the following will cause a rightward shift in aggregate demand?

(i) Expected increase in firm profits.

(ii) A decrease in income tax rates.

(iii) An increase in expected future income.

(iv) A fall in the price level.

Only i, ii and iii.

ii and iii.

Only ii and iv.

i and iii.

Which term is used to describe the recession-expansion pattern that happens in our economy?

The chapter explains that Social Security benefits are increased each year in proportion to the increase in the CPI, even though most economists believe that the CPI overstates actual inflation. a. If the elderly consume the same market basket as other people, does Social Security provide the elderly with an improvement in their standard of living each year? Explain

Briefly discuss the importance of (SMEs) small business enterprises sector in the South African economy

Discuss the role that tertiary education can play in order to address unemployment problem in South Africa. (Hint: focus on the role of transforming universities into entrepreneurial universities)

In the aggregate expenditure model for a closed economy, assuming investment, government spending and taxes are exogenous, if the marginal propensity to consume is 0.8, a simultaneous 50 unit increase in government spending and a 20 unit decrease in investment will change equilibrium income by:

Argue how free trade rather than protectionism can favour countries