Macroeconomics Answers

Question 2: A country might want to produce more of capital goods as they will create a future stream of benefits whereas consumer goods are consumed immediately having no long term benefits- Comment on the country’s production possibility curve. [10]

Question 1
Which one of the following statements is incorrect?
[1] The opportunity cost of holding money balances is the interest that could have been earned if the money had been used to purchase interest-bearing assets instead.
[2] The quantity of money demanded for transaction purposes depends on the interest rate.
[3] The demand for money as an asset is also called the speculative demand for money.
[4] The quantity of money demanded for speculative purposes is negatively related to the interest rate.

Question 2
The function of the South African Reserve Bank as bank supervisor entails …
[1] reducing interbank settlement risks by reducing the potential for settlement default by one or more banks.
[2] making, issuing and destroying banknotes and coins.
[3] achieving a sound, efficient banking system in the interest of depositors of banks and the economy as a whole.
[4] formulating an exchange rate policy.

Calculate consumption of fixed capital
NNPfc 6000 GDPmp 8000 NIT 400 NFIA 100

Which of the following statements is false

A savings are an important injection into the circular flow of income and spending in the economy

B taxes are a leakage or withdrawal from the flow of income and spending in the economy

C spending by households on consumer goods and services is called consumption spending

Which one of the following statements regarding fiscal policy and the budget is correct

A when the government plans to stimulate economic activity, it can increase spending or reduce taxes

B revenue from tax is always greater than government spending in south africa

C demand management only refers to fiscal policy

D a contractionary fiscal policy should be implemented to combat unemployment

Which of the following represents a stock variable

a wealth, saving and unemployment
b Gold reserves held by the South African Reserve Bank, and investment
C income,profit and investment
C wealth, assets and liabilities

explain with the aid of a graph the impact of a cut in the interest rate on the demand for money

a firm has the following production function No:of workers 0,1,2,3,4,5,6 No: of quantity produced 0,8,15,21,26,30,33 find the MPN for each level of employment b) how many workers will it hire if the nominal wage is $38? if it is 22?

when does a budget deficit occur?