Macroeconomics Answers

The slope of the AE curve is .80. What is the multiplier? Everything else the same, by how much does equilibrium aggregate expenditure increase if

a) exports increase from $1.75 trillion to $2.25 trillion. (8 marks)

b) government expenditure on goods and services decrease from $2.0 trillion to $1.8 trillion.

(6 marks)

c) investment increases from $1.2 trillion to $2.3 trillion. (6 marks)

QUESTION 2

The term “marriage markets” was first coined by Becker (1961), the Economics Nobel Prize recipient of 1992, and has since gained ground with most microeconomists.

(a) Explain why the correct analogy for the phrase “marriage market” is that of the labor market and not “husbands buying wives”? (3 marks )

(b) Discuss factors that may cause marriage dissolution. (12mars)

(c) Discuss how marriage dissolution or anticipation of marriage dissolution could impact female labour supply. (10marks ) 

QUESTION ONE:

1.1 Discuss the ‘General Equilibrium’ concept and its simplifying assumptions. (12 marks)

1.2 Using an Edgeworth box and practical examples, discuss the ‘gains from trade’ aspect of a ‘two agent’ economy. (13 marks)

Which of the following is INCORRECT regarding the reasons why we continue to (2) study the Malthusian trap, even though evidence shows that it is not currently

relevant?

(a) Because many people still believe it holds in poor countries today, and the

model should be understood to motivate effective debate.

(b) Because the model focuses on the microeconomics of family size decision making in which individual levels of living become the principal determinant of a family’s decision to have more or fewer children. 

(c) Because such traps have occurred in the past and may have been factors in population collapses.

(d) The fact that this model no longer applies underlines the importance of factors that can prevent its emergence. 

1. Programmes to improve environmental conditions are likely to be most effective (2) when:
2. (a) They work in tandem with community networks.
3. (b) They have significant budgets.
4. (c) They involve energy, water and agricultural subsidies.
5. (d) They involve mandatory private investment in sustainable farming
6. techniques. 

what is the opportunity cost of producing an additional bowling ball measured in terms of forgore bicyles in eastern leisureland?

In Anasville nominal GDP in 2030 is $30,000 and the price index (base of 100 in 2020) stands at 150. Find real GDP expressed in 2020 dollars.

Discuss the evolution of the payment system