Macroeconomics Answers

Which of the following statements is/are correct about the tax incidence?

a. If the price elasticity of demand for a good is relatively inelastic, the producers bear a greater tax burden than the consumers.
b. If the price elasticity of demand for a good is relatively elastic, the consumers bear a greater tax burden than the producers.
c. If the price elasticity of demand is unitary elastic, both the consumers and the producers bear an equal amount of the tax burden.

[1] All the statements are correct.
[2] Only a
[3] Only b
[4] Only c
[5] Only a and c

Identify and define the macroeconomic variables that can be used to measure whether the strategy was successful or not.

The core elements of the growth employment and redistribution strategy of south African government in 1996,under the leadership of the then finance minister Trevor Manuel were amongst other things:
Budget reform to strengthen the redistributive thrust of expenditure
Monetary policy to prevent a resurgence of inflation
A reduction in tariffs to contain input prices and facilities industrial restructuring,compensating partially for the exchange rate depreciation

1.1 with referenc to the above,identify the macroeconomic objectives in these elements
1.2 Identify and define the macroeconomic variables that can be used to measure whether the strategy was successful or not
1.3 with each tool in 1.2, provide a detailed explanation on how it can be measured.

Question 1
The core elements of the Growth Employment and Redistribution (GEAR) strategy of the South African government in 1996, under the leadership of the then finance minister Trevor Manuel were amongst other things:
 budget reform to strengthen the redistributive thrust of expenditure
 monetary policy to prevent a resurgence of inflation
 a reduction in tariffs to contain input prices and facilitate industrial restructuring, compensating partially for the exchange rate depreciation
1.1 With reference to the above, identify the macroeconomic objectives in these elements. (3 marks)
1.2 Identify and define the macroeconomic variables that can be used to measure whether the strategy was successful or not. (6 marks)
1.3 With each tool in 1.2, provide a detailed explanation on how it can be measured. (11 marks)

The core elements of the Growth Employment and Redistribution (GEAR) strategy of the South African government in 1996, under the leadership of the then finance minister Trevor Manuel were amongst other things:
 budget reform to strengthen the redistributive thrust of expenditure
 monetary policy to prevent a resurgence of inflation
 a reduction in tariffs to contain input prices and facilitate industrial restructuring, compensating partially for the exchange rate depreciation
1.1 With reference to the above, identify the macroeconomic objectives in these elements. (3 marks)

The core elements of the Growth Employment and Redistribution (GEAR) strategy of the South
African government in 1996, under the leadership of the then finance minister Trevor Manuel were
amongst other things:
 budget reform to strengthen the redistributive thrust of expenditure
 monetary policy to prevent a resurgence of inflation
 a reduction in tariffs to contain input prices and facilitate industrial restructuring,
compensating partially for the exchange rate depreciation

1.3 With each tool in 1.2, provide a detailed explanation on how it can be measured.

The core elements of the Growth Employment and Redistribution (GEAR) strategy of the South
African government in 1996, under the leadership of the then finance minister Trevor Manuel were
amongst other things:
 budget reform to strengthen the redistributive thrust of expenditure
 monetary policy to prevent a resurgence of inflation
 a reduction in tariffs to contain input prices and facilitate industrial restructuring,
compensating partially for the exchange rate depreciation

1.2 Identify and define the macroeconomic variables that can be used to measure whether
the strategy was successful or not.

effectivness of conventional and unconventional monetary policy in stabilizing price in Nigeira economy

what are the possible explanation for the recent failure of fiscal and monetary policy to solve the stagflation problem?