Macroeconomics Answers

1. Discuss, using the IS-LM model, what happens to interest rates as prices change along a given AD schedule.

2. What is crowding out, and when would you expect it to occur? In the face of substantial

crowding out, which will be more successful—fiscal or monetary policy?

Analyse how an increase in exports could improve a country’s economic performance.

Using diagrams and the concept of elasticity of demand to support your answer, explain how both UK rail companies and airways go about filling seats in order to maximise revenue

Explain whether or not, why, and how the following items are included in the calculation

of GDP?

a) Suppose that the appliance store buys a refrigerator from the manufacturer on December 15, 2016

for Tk. 25,000, and that you then buy on August 5, 2017 for Tk. 40,000. What is the contribution to

GDP in fiscal year FY 2017 (July 2016 to June 2017)?

A farmer has been using 2 employees and 1 tractor to produce 1000 bags of maize. If the farmer increases the employees to 4 and the tractors to 2 what would be the nature of returns to scale if production rose to

(I) 2000 bags

(Ii) 500bags

(III) 3000 bags

Which one of the following statements about tax is true?

A. Proportional tax is when everybody pays the same amount of tax.

B. Income tax is levied on a yearly basis.

C. Excise tax is a progressive tax.

D. Regressive tax is when all taxpayers pay the same rate.

If we have unemployment rate 4.0% , labor force 120000 and labor force participation rate 65.0% then how many are employed and how many are unemployed?

Wich of the following statements regarding stock and flow variables is correct?

Consider the most appropriate policy for tackling each of the different types of unemployment.

Mention and explain the type of policy that can be implemented to combat cost push inflation