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Answer true or false and explain your answer
(1) If an economy can raise its annual real GDP growth rate from 3.8 percent to 4.5 percent, its real GDP doubling time is reduced by 15 years.
(2) Suppose that the government passes a law requiring households to increase savings 10% above previous levels. According to Solow's growth theory, in the long run output per capita will grow less rapidly.
(3) If an economy has a real GDP doubling-time of 48 years, this will be increased to 56 years if annual GDP growth is reduced by 3.2 percentage points.
(4) If K = 3000, n = 0.02, and depreciation, δ= 0.04 and g =0.03, then investment of 320 will hold (K/AL) constant.
(5) Suppose s = 0.15, Y = 4200, K = 6100, n = 0.03, g=0.03 and δ= 0.10. This makes national saving smaller than steady-state investment, so that the amount of capital per effective worker will be falling.
The monetary policy transmission mechanism shows the relationship between
Suppose milk and honey are the only products produced in Ghana. Use the data belowfrom the
ii.real GDP, (3marks)
a.Computefor each year the
economy of Ghana to answer the questions that follow:
iii.the GDP deflator.(3marks)
YearPrice of MilkQuantity of MilkPrice of HoneyQuantity of Honey
i.nominal GDP, (3marks)
2012Ghc1200Ghc2100
2013Ghc2200Ghc4100
2011Ghc1100Ghc250
Base year: 2011
b.Compute for 2012 and 2013 from the respective preceding years the percentage change in
Required:
i.nominal GDP, (2marks)
ii.real GDP, (2marks)
iii.the GDP deflator (2marks)
You are the manager of a firm that receive revenue of Rs.30,000 per year from product X and Rs. 70,000 per year from product Y. The own price elasticity of demand for product X is -2.5 and the cross price elasticity of demand between product Y and X is 1.1. How much will you firm’s total revenue (revenues from both products) change if you increase the price of good X by 1 present?
what do you understand by inflation tax? who pays inflation tax?
Discuss the extent to which the traditional approach is an adequate model of exchange rate determination.
(1) In the Solow growth model, given the values of A=120, s=0.11, n=0.03, g=0.07, and δ=0.08, the economy has an equilibrium growth rate of real GDP per effective labour, (Y/AL), equal to 8 percent.
(2) In the graph of the Solow growth model, at any point to the left of the steady-state intersection we have national saving per effective labour greater than steady-state investment per person, causing (K/AL) to increase.
(3) In the Solow growth model, an increase in the marginal propensity to consume shifts the steady-state investment line downward with the implied change in the capital stock resulting in a higher standard of living in the long run.
(1) If an economy can raise its annual real GDP growth rate from 3.8 percent to 4.5 percent, its real GDP doubling time is reduced by 15 years.
(2) Suppose that the government passes a law requiring households to increase savings 10% above previous levels. According to Solow's growth theory, in the long run output per capita will grow less rapidly.
(3) If an economy has a real GDP doubling-time of 48 years, this will be increased to 56 years if annual GDP growth is reduced by 3.2 percentage points.
(4) If K = 3000, n = 0.02, and depreciation, δ= 0.04 and g =0.03, then investment of 320 will hold (K/AL) constant.
(5) Suppose s = 0.15, Y = 4200, K = 6100, n = 0.03, g=0.03 and δ= 0.10. This makes national saving smaller than steady-state investment, so that the amount of capital per effective worker will be falling.
