Macroeconomics Answers

When government becomes a lender in the loanable funds market:

(i)

The supply of funds increases, and the interest rate decreases.

(ii)

The supply of funds increases, and the interest rate increases.

(iii)

The supply of funds decreases, and the interest rate decreases.

(iv)

The supply of funds decreases, and the interest rate increases.

A.

only (i) is correct.

B.

(i) and (ii) are correct.

C.

only

(iii) is correct.

D.

(ii) and (iv) are correct.

When government becomes a lender in the loanable funds market: 

(i) The supply of funds increases, and the interest rate decreases.

(ii) The supply of funds increases, and the interest rate increases.

(iii) The supply of funds decreases, and the interest rate decreases. 

(iv) The supply of funds decreases, and the interest rate increases.

A. only (i) is correct.

B. (i) and (ii) are correct.

C. only (iii) is correct.

D. (ii) and (iv) are correct.

P0 = R130; Ps = R 100; Pm = R200; Q1 = 1000; Q0 = 1200

Q.9.3.1 Calculate supplier’s revenue before tax. (2)

Q.9.3.2 Calculate the supplier’s revenue after tax. (2)

Q.9.3.3 Calculate the total tax revenue collected by the government. (2)

Q.9.3.4 Calculate the total tax paid by the consumers. (2)

Q.9.3.5 Calculate the total tax paid by the suppliers. (2)

Q.9.3.6 Compare the results in 9.3.4 and 9.3.5 above and give a logical

explanation for the variance.

(4)

Assuming there is no Ricardo-Barro effect, a government budget deficit will____ the real interest rate and ____ the quantity of investment.

lower; decrease.

raise; increase.

raise; decrease.

lower; increase.

How successful was the NGP in influencing economic growth and development in South Africa

Use the data in the following table to answer the question.

Units Total costs

0 100

1 110

2 130

3 166

The average fixed cost of the third unit is

Advise the government on how to promote industrial development in South Africa

1. Describe the five phases of the business cycle.                                                    (10 marks)
2. If an economy is in the recession phase of the business cycle, what are the appropriate policies that the government should formulate to tackle this problem?             (7marks)

What are the main factors influencing the shadow economy

Assuming there is no Ricardo-Barro effect, a government budget deficit will____ the real interest rate and ____ the quantity of investment.

lower; decrease.

raise; increase.

raise; decrease.

lower; increase