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As a response to Covid-19 the SARB cut its benchmark interest rate to a low record. In the last meeting held on the 25th March 2021, the South African reserve bank’s Monetary Policy Committee (MPC) announced that interest rates would remain stable at 3.5 percent and the prime lending rate at 7 percent. This was largely in line with Economists expectations. What would be the effect of the decision on property price. Is there a possibility of a property bubble?
Explain the term Dutch Disease and use it to advise policy makers of your country in the light of the recent discovery and production of oil in Ghana
Hi, please assist.Given the demand for a product as Qd = 100 - 5P and the supply is given as Qs = -20 + 3p. You are told equilibrium is obtained at the point where Qd = Qs. The equilibrium quantity for the product is
Use the following functions that show quantity demanded and quantity supplied to answer the question. Qd = 100 – 5P and Qs = –20 + 3P. If the price is R10, then there will be a shortage of
Consider an economy having following values of Consumption, Investment, Government
Spending, and Taxes,
C = 300 + 0.7Yd I = 200 – 200i G = 600 T = 100
Derive the aggregate demand equation. Also, calculate the output in an economy
Assume the economy is in a recession. Explain how each of the following policies would affect consumption, investment and national income (GDP). In each case, indicate any direct effects, any effects resulting from changes in the macroeconomic variables and the overall effect in the economy. If there are conflicting effects making the answer ambiguous, say so.
a) How fiscal policy influences aggregate demand and how these can be used to expand the economy?
b) How monetary policy influences aggregate demand and how these can be used to expand the economy?
In response to unemployment challenges in an economy, the government put in place several macroeconomic policies. Discuss at a theoretical level how public policies such unemployment benefits and tax incentives can affect the employers, government and the level of unemployment, taking into account the age groups, skills endowments and substitution effects of the various workers in an economy
As a business economist, critically analyse how changes in the world price of oil affect the amount of frictional unemployment in a country
In a recent article on BusinessLive, Duma Gqubule argues that South Africa does not have a real
central bank. He criticises the conduct of monetary policy and puts forward a range of proposals
under the umbrella term monetary finance.
1. Compare his proposals to what you have learned about monetary policy in Chapter 9. You
can compile a summary table as follows. (12)
The SARB’s way Gqubule’s proposals
The objective of monetary policy
The targets
The way in which policy is
conducted, and instruments used
2. Represent Gqubule’s reasoning using the AD’-PC model from chapter 7:
2.1 The Covid-19 lockdown as a supply shock only. (6)
2.2 His monetary policy proposals. (6)
2.3 His proposals for what to do when too much money is created. (6)
(all on a single graph, with explanations, please)
ECON211 Policy application, Assignment 3, 2021
In a recent article on BusinessLive, Duma Gqubule argues that South Africa does not have a real
central bank. He criticises the conduct of monetary policy and puts forward a range of proposals
under the umbrella term monetary finance.
1. Compare his proposals to what you have learned about monetary policy in Chapter 9. You
can compile a summary table as follows. (12)
The SARB’s way Gqubule’s proposals
The objective of monetary policy
The targets
The way in which policy is
conducted, and instruments used
2. Represent Gqubule’s reasoning using the AD’-PC model from chapter 7:
2.1 The Covid-19 lockdown as a supply shock only. (6)
2.2 His monetary policy proposals. (6)
2.3 His proposals for what to do when too much money is created. (6)
(all on a single graph, with explanations, please)
