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Macroeconomics
What is the avg variable cost of the second unit produces?
Quantity total cost
0 20
1 25
2 35
3 50
Macroeconomics
Suppose that an exogenous disturbance, such as a change in government policy, leads to a balance of payments deficit and a consequent fall in the exchange rate. Discuss the effects of the new exchange rate level on the balance of payments and the exchange rate.
Macroeconomics
The monetary policy transmission mechanism shows the relationship between
Macroeconomics
(b) Calculate National Income
S.No.
Component
Amount
1
Private final Consumption Expenditure
900
2
Corporation Tax
100
3
Govt. Final Consumption Expenditure
200
4
Personal Income Tax
120
5
Undistributed Profit
50
6
Change in stocks
(-)20
7
Net domestic fixed capital formation
120
8
Net Imports
10
9
Net Indirect Tax
150
10
Net Factor income earned from abroad
(-)10
11
Private income
1000
S.No.
Component
Amount
1
Private final Consumption Expenditure
900
2
Corporation Tax
100
3
Govt. Final Consumption Expenditure
200
4
Personal Income Tax
120
5
Undistributed Profit
50
6
Change in stocks
(-)20
7
Net domestic fixed capital formation
120
8
Net Imports
10
9
Net Indirect Tax
150
10
Net Factor income earned from abroad
(-)10
11
Private income
1000
Macroeconomics
Q1(a) A firm makes and sell jam using fruit it buys from another firm for rupees 70000. It pays its workers Rs. 50000, pays Rs. 10000 in taxes and has profits of Rs. 40000. What is its value added?
Macroeconomics
(b) Suppose currency to deposit rato is 040 and required reserve ratio is 0.10 and Govt. buys bonds from public which increase the Monetary Base by Rs. 10000. Find out how much money supply will be changed? Also find the money multiplier.
Macroeconomics
(a) Graphically illustrate and brefiely explain the impact of an increase in the reserve ratio , Ɵ, on the money for central bank money.
Macroeconomics
b) Assume that the demand for real money balances is:
MP = Y[0.6-(r+e)
Income, y =1000 real rate of intrest= 0.05
Expected inflation rate is e is constant 0.05
Calculate seinorage if the rate of growth of nominal money is 7%
MP = Y[0.6-(r+e)
Income, y =1000 real rate of intrest= 0.05
Expected inflation rate is e is constant 0.05
Calculate seinorage if the rate of growth of nominal money is 7%
Macroeconomics
b) Assume that the demand for real money balances is:
MP = Y[0.6-(r+e)
Income, y =1000 real rate of intrest= 0.05
Expected inflation rate is e is constant 0.05
Calculate seinorage if the rate of growth of nominal money is 7%
MP = Y[0.6-(r+e)
Income, y =1000 real rate of intrest= 0.05
Expected inflation rate is e is constant 0.05
Calculate seinorage if the rate of growth of nominal money is 7%
Macroeconomics
Regina owns a tax accounting business that has 3 PCs. One PC wears out each year and is replaced. In addition, this year Jeannie will expand her business to 5 PCs. Calculate Jeannie’s initial capital stock, depreciation, gross investment, net investment, and final capital stock
