Macroeconomics Answers

which of the following statements are correct ?

i) Ceteris paribus, as the real wage rate increases, the quantity of labour demanded increases

ii) An increase in the working age population results in an increase in the supply of labour

iii) A change in the real wage rate brings a movement along the labour supply curve

iv) the demand for labour is determined by the diminishing returns to labour

A. Only (i), (ii) and (iv) are correct

B. Only (ii), (iii) and (iv) are correct

C. Only (i) and (iii) are correct

D. Only (i), (iii) and (iv) are correct

how many years will it take for GDP to double from 40 billion to 80 billion if the growth rate is 0,25% per year

How does the response of the interest rate to a change in the money stock depend on the

interest sensitivity of money demand? 

If aggretate exppenditure is greater than total income:

1. investment will decrease because such a high level cannot be sustained.
2. planned savings will decrease in line with investment.
3. output will increase to replenish depleted inventories.
4. investment will decrease to run down excessive inventories.
5. there is an error, since the two are same by definition

Consider the following information:

MPC = 0.9

Autonomous Investment = R200 m

Autonomous Consumption = R70 m

The equilibrium level of income is:

1. R300 m
2. R700 m
3. R2 000 m
4. R2 700 m
5. Impossible to calculate from the information given.

a. How does an increase in the tax rate affect the IS curve?

b.

How does the increase affect the equilibrium level of income?

c.

How does the increase affect the equilibrium interest rate? 

The multiplier in the Keynesian model equals:

1.the equilibrium level of income for a given level of aggregate expenditure.

2.the increase in autonomous expenditure brought about by a change in income.

3.the equilibrium level of income divided by autonomous expenditure.

4.the increase in equilibrium income when autonomous expenditure increases.

5.the level of equilibrium output corresponding to a given level of aggregate spending

Use the information in the table below to answer:

CPI Index (Dec 2012 = 100)

Year July August September October

2014 104 106 107 110

2015 112 113 115 116

1. The monthly inflation rate for October is 0.90 %. TRUE OR FALSE?

.2. The annual inflation rate for October 2015 is 5.45 %. TRUE OR FALSE?