Macroeconomics Answers

In no more than 250 words, explain the impact of COVID19 crisis on the economy of New Zealand. Discuss specifically its impact on GDP, trade, inflation, employment and business activity. Supplement with the relevant national statistics, where possible.

In no more than 400 words, explain the impact of COVID19 crisis on the economy of New Zealand. Discuss specifically its impact on GDP, trade, inflation, employment and business activity. Supplement with the relevant national statistics, where possible. 

You are given the following data. Calculate GNP and GDP at factor cost.

GNPMP 600

Indirect Taxes 50

Subsidies 30

NFIA 100

Depreciation 50

Transfer payments 15

Retained Earnings of Companies 25

Personal Taxes 15

Personal Savings 80

Q.2 The following equations describe an economy:

C= 10 + 0.5 Y (Consumption function)

I = 190-20i (Investment function)

Derive the equations for IS curve and represent it graphically for i=2 and i=5

In 2012/13 Cyprus was hit by banking crisis. Jeroen Dijsselbloem, the former head of the

Eurogroup, remarked in this context: „From now on the [bank] creditors will be held

financially responsible in resolution funding. Public sector financial aid will be the

exception.“

a) Judged against the competencies of the Eurogroup, was Jeroen Dijsselbloem

in a position to make this statement?

b) Explain what he meant.

c) He was heavily criticised for the statement, amongst others by

representatives of the European Central Bank. What are possible reasons for

the criticism?

d) Judged retrospectively against the evolution of EU bank regulation (“Banking

Union”), was he more right or more wrong?

Eurostat projects significant increases of the old-age dependency ratio in the EU for the

years to come.

What are likely implications for EU potential output and government budgets?

Can migration into the EU help to cushion the effect; under what conditions?

A country is exhibiting persistent trade surpluses (exports > imports). At the same time,

the economy´s interest income received from abroad exceeds the interest paid to the

rest of the world. How is the country´s net financial investment position evolving?

In the years prior to European monetary union, long-term interest rates in the countries

forming the (later) euro area converged towards the lowest levels. What could explain

this development

When the government introduces new taxes on the company what happens to the company supply?

Explain the effect on equilibrium price and quantity of a fall in demand, ceteris paribus