Macroeconomics Answers

what determines the cyclical behavior of output and employment? what causes recessions?

Omecron / covid-19 effect on society which school of thought suitable in this situation?

Calculate the GDP using EXPENDITURE APPROACH with the following hypothetical data:

Personal Consumption

3657

Depreciation

400

Wages

3254

Indirect Business Taxes

500

Interest

530

Domestic Investment

741

Government Expenditure

1098

Rental Income

17

Corporate Profits

744

Exports

673

Imports

704

Net Factor Payment

20

Consider the following data in Billions of dollars:

GDP 7500

Investment 1300

Transfer Payment 1050

Government Expenditures 1200

Exports 1050

Imports 950

Net Factor Payment 20

a) Use the above data to calculate the consumption.

b) Whether the economy has trade deficit or trade surplus? Why?

How the economic problems can be solved during the covid-19? Which school of thought help in the best way to solve these problems.

what are the determinants of the rate of inflation? What role do macroeconomics polices play in determining inflation rate?

Explain law of diminishing returns

Explain the concept of average propensity to consume (APC) and average propensity to save (APS) .

Given the following information:

Consumption Funciton = C = 1600 + 0.4Yd

Investment = RM1200

Government Expenditure = RM 1180

Taxes = RM6

Derive new consumption function and saving function for this economy.

Calculate the national income equilibrium for a three sector economy using AS=AD Approach and Leakage = Injection Approach. 

Draw the curve for the national income equilibrium for a three sector economy using AS=AD Approach and Leakage = Injection Approach. 

Here are 5 monopoly-related essay titles. How might you answer each one so that you specifically answer the question set?

• Discuss the view that all monopolies are bad for consumers
• Assess the extent to which monopolies are bad for the economy
• Evaluate whether all monopolies should be heavily regulated
• To what extent is a monopoly likely to reduce economic welfare?
  
• Assess the extent to which monopolies are beneficial

Carefully explain what is meant by a natural monopoly, remembering to add in relevant examples. Draw a natural monopoly diagram in the space at the bottom of the page.

Diagram:

Outline some of the issues facing a natural monopoly firm if it chooses to maximise its profits:

Outline some of the issues facing a natural monopoly firm if it is nationalised / run by the state and aims for allocative efficiency:

Consider an open economy with a fixed exchange rate at time t. Suppose that initially financial market participants believe that the government is committed to maintaining the fixed exchange rate. Suppose at time t+1 the central bank announces a devaluation. The exchange rate will remain fixed, but at a new level, where the new fixed exchange rate is below the initial fixed exchange rate. At the new level of fixed exchange rate, assume that financial market participants believe that there will be no further devaluation and that the government will remain committed to maintaining the exchange rate.

a) Draw an IS-LM-UIP diagram for this economy. Consider the change in the expected exchange rate.

b) Based on your answer in (a), what would happen to the domestic interest rate if there is no change in the domestic money supply? Explain in suitable diagram and equation.