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Macroeconomics
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.
1.3 With each tool in 1.2, provide a detailed explanation on how it can be measured.
Macroeconomics
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 redistributihe 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
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.
°budget reform to strengthen the redistributihe 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
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.
Macroeconomics
Which of the following statements regarding taxation is/are correct?
a. A neutral tax leaves the same tax burden on all the tax payers.
b. Exclusion is highly impossible in the case of public goods.
c. Tax avoidance occurs when people illegally do not pay the taxes due by them.
[1] All the statements are correct
[2] Only a and b
[3] Only a and c
[4] Only b
[5] Only c
a. A neutral tax leaves the same tax burden on all the tax payers.
b. Exclusion is highly impossible in the case of public goods.
c. Tax avoidance occurs when people illegally do not pay the taxes due by them.
[1] All the statements are correct
[2] Only a and b
[3] Only a and c
[4] Only b
[5] Only c
Macroeconomics
Consider the following table, which shows the production possibilities of the two countries X and Y
Country X: Cement production (Output of 100 men) = 100; Paint production (Output of 100 men) = 150
Country Y: Cement production (Output of 100 men) = 40; Paint production (Output of 100 men) = 120
Total cement production = 140; Total paint production - 270
It would be more efficient for country Y to export
[1] cement
[2] both cement and paint
[3] paint
[4] none of the two goods
Country X: Cement production (Output of 100 men) = 100; Paint production (Output of 100 men) = 150
Country Y: Cement production (Output of 100 men) = 40; Paint production (Output of 100 men) = 120
Total cement production = 140; Total paint production - 270
It would be more efficient for country Y to export
[1] cement
[2] both cement and paint
[3] paint
[4] none of the two goods
Macroeconomics
Consider the following table, which shows the production possibilities of two countries X and Y
Country X: Cement production (Output of 100 men) = 100; Paint production (Output of 100 men) = 150
Country Y: Cement production (Output of 100 men) = 40; Paint production (Output of 100 men) = 120
Total cement production = 140; Total paint production - 270
Which one of the following statements is correct?
[1] Country Y has an absolute advantage in the production of paint, and a comparative advantage in the production of cement.
[2] Country X has an absolute advantage in the production of both paint and cement, and a comparative advantage in the production of paint.
[3] Country Y has an absolute advantage in the production of cement, and a comparative advantage in the production of paint.
[4] Country X has an absolute advantage in the production of both paint and cement, and a comparative advantage in the production of cement.
Country X: Cement production (Output of 100 men) = 100; Paint production (Output of 100 men) = 150
Country Y: Cement production (Output of 100 men) = 40; Paint production (Output of 100 men) = 120
Total cement production = 140; Total paint production - 270
Which one of the following statements is correct?
[1] Country Y has an absolute advantage in the production of paint, and a comparative advantage in the production of cement.
[2] Country X has an absolute advantage in the production of both paint and cement, and a comparative advantage in the production of paint.
[3] Country Y has an absolute advantage in the production of cement, and a comparative advantage in the production of paint.
[4] Country X has an absolute advantage in the production of both paint and cement, and a comparative advantage in the production of cement.
Macroeconomics
Which of the following statements regarding the public sector is/are correct?
a. Private market systems always achieve equitable and sufficient outcomes.
b. In the mixed economy, only the government and the market forces play an important role.
c. Market failure justifies the need for government intervention.
[1] Only a and c
[2] Only b
[3] Only c
[4] Only a and b
[5] All the statements are correct
a. Private market systems always achieve equitable and sufficient outcomes.
b. In the mixed economy, only the government and the market forces play an important role.
c. Market failure justifies the need for government intervention.
[1] Only a and c
[2] Only b
[3] Only c
[4] Only a and b
[5] All the statements are correct
Macroeconomics
Which of the following statements regarding the demand for money is/are correct?
a. The speculative demand for money is independent of the changes in income.
b. The precautionary demand for money decreases as the interest rate decreases.
c. Changes in income will cause a shift of the total demand for money curve.
[1] Only a and c
[2] Only b and c
[3] Only a
[4] Only b
[5] Only c
a. The speculative demand for money is independent of the changes in income.
b. The precautionary demand for money decreases as the interest rate decreases.
c. Changes in income will cause a shift of the total demand for money curve.
[1] Only a and c
[2] Only b and c
[3] Only a
[4] Only b
[5] Only c
Macroeconomics
1.2 Identify and define the macroeconomic variables that can be used to measure whether the strategy was successful or not.
Macroeconomics
In order to reduce the money supply, the SARB could
[1] reduce the interest rate.
[2] increase the tax rate.
[3] buy the government bonds.
[4] sell the securities.
[1] reduce the interest rate.
[2] increase the tax rate.
[3] buy the government bonds.
[4] sell the securities.
Macroeconomics
Which of the following statements is/are correct about money supply?
a. An increase in the bank’s demand deposit will result in a decrease in the required cash reserves.
b. The quantity of money supplied in the economy is a flow concept.
c. A decrease in the required reserve ratio will cause an increase in the credit multiplier.
[1] All the statements are correct
[2] Only a
[3] Only c
[4] Only a and c
[5] Only a and b
a. An increase in the bank’s demand deposit will result in a decrease in the required cash reserves.
b. The quantity of money supplied in the economy is a flow concept.
c. A decrease in the required reserve ratio will cause an increase in the credit multiplier.
[1] All the statements are correct
[2] Only a
[3] Only c
[4] Only a and c
[5] Only a and b
