Economics Answers

Assume an economy does not trade with the outside world. In a given fiscal year, household spent 80% of their disposable income on consumption in addition to 600 consumption expenditure which is independent of income. Total government expenditure of 900 was supposed to be financed from a proportion tax levy of 40% on national income and a lump sum tax of 450. Total private investment spending is 700. Given that aggregate output is equal to aggregate spending. Determine the value of the multiplier.

Assume Aduhene economy does not trade with the outside world. In a given fiscal year, households spent 80% of their disposable income on consumption in addition to 600 consumption expenditure which is independent of income. Total government expenditure of 900 was supposed to be financed from a proportion tax levy of 40% on national income and a lump sum tax of 450. Total private investment spending is 700. Given that aggregate spending is equal to aggregate output.

1. Determine the value of the multiplier

2. Find the equilibrium level of output

What is the problem of Principal – Agent? How the problem of principal-agent be resolved,
elaborate in the light of Agency Cost Theory?

Your company makes copper pipes. Over the years, you have collected a large inventory of raw
copper. The production process involves melting the copper and shaping it into pipes. You also
have a large stockpile of pennies. Suppose the price of copper rises so much that the copper in
the penny becomes worth more than one cent. Should you melt down your pennies?

Assume Joy economy does not trade with the outside world. In a given
fiscal year, households spent 80% of their disposable income on
consumption in addition to 600 consumption expenditure which is
independent of income. Total government expenditure of 900 was
supposed to be financed from a proportion tax levy of 40% on national
income and a lump sum tax of 450. Total private investment spending is
700. Given that aggregate spending is equal to aggregate output.
1. Determine the value of the multiplier
2. Find the equilibrium level of output

A small town mayor has two proposals for building a road. The first is to let a private company build the road, and the second is for the local government to make it. The fixed cost of the road is $2 million, while its maintenance cost is 0.

In what ways do developing countries depend on rich countries? In what ways is the opposite true?

Evaluate the importance of productivity for the rate of economics growth

Hint includes - Actual growth, potential growth, AS/AD diagrams.

Economics A level (this is a 20 marker)

What does a reduction in terms of trade mean

The cross elasticity between oranges and pears is -0.78, then 2 goods are ?