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Assets
Liabilities
Reserves $ 1,500
Loans $ 3,500
Initial Deposit $ 5,000
Assume required reserve ratio is 10 percent and that 100% of all the loans are deposited as new deposits.
ii. Calculate the deposit and credit multiplier.
I. Define and discuss the following terms (Hint: Give a graph or formula where applicable).
a) Unemployment
b) Labor Force
c) Adult Working Population
d) Okun’s Law
e) Minimum Wage
Consider the following statistics from a Labor Market and then answer the questions which follow;
• 8,570 workers have been laid-off from employment and are waiting to be recalled.
• 4,523 have lost morale and quit actively seeking employment.
• 3,498 people are below 16years.
• 53,862 people are currently in education and not searching for employment.
• 9,454 workers have been retired from employment.
• 57,367 workers are employed but 65% are still searching for better employment.
• 378 people have switched between jobs.
• 157 quit their jobs because of low salaries and are seeking better paying jobs.
• 12,321 new graduates are actively seeking formal employment.
• 1,563 are in jail.
a) How many people are discouraged workers?
b) How many people are unemployed?
c) How many people are in the Labor Force?
d) Calculate the unemployment rate?
e) How many people are not in the Labor Force?
f) How many people are part of the Adult Working Population?
a) Discuss whether minimum wage laws are good or bad for the economy.
b) What would compel a firm to pay above equilibrium wages?
c) Discuss the major types of unemployment?
d) Discuss the policies that can be implemented to cure unemployment (Hint: Demand side policies and Supply side policies).
e) Suppose that UNZA is a country with a population of 321,166,640 people of which the number of unemployed people is 121,166,640. The employment rate in this economy is 0.104, and the labour force participation rate 72.5%.
i. What is the size of the labour force?
ii. How many people are unemployed and employed?
iii. What is the size of the working-age population?
iv. If the total output produced domestically in this country is 625,234,567, what is the GDP per-capita?
Consider a hypothetical economy for which you are given the following information.
C = 102 + 0.7Y
I = 150 − 100r
Ms = 300
Md = 0.25Y + 124 − 200r
Required
- write the IS equation and explain it.
- Find the LM equation and give its explanation
- Find the equilibrium level of income and equilibrium level of interest
- Find the level of of C, the level of I, the level of L(Md) when the economy is in equilibrium
- Construct the tables of IS and LM curves. put them together on the new graph to determine the equilibrium level of income and interest rate graphically.
- Industrial sector development in Ghana has undergone various phases - protectionism policies to a focus on the private sector as the driving force in economic growth. Discuss these policies and assess lessons that Ghana draw on from other developing economies around the globe to transform the industrial sector.
Explain the term 'Dutch Disease' Use it to advise the policy makers of your country in the light of the recent discovery and production of oil in a country.
Use the Solow growth model to discuss the implications of this pandemic on the prospects of long run economic growth for South Africa
effects of inflation
