Economics Answers

C=100+0.80Y,what is the savings function in the simple Keynesian model?
1. S=-100+0.20Y
2. S= 100+0.20Y
3. 0.20
4.5

what is nationalisation

28.1 The financial year of T. Guiness ended on 31 December 2006. Show the ledger accounts
for the following items including the balance transferred to the necessary part of the
financial statements, also the balances carried down to 2007.
(a) Motor expenses: Paid in 2006 $819; Owing at 31 December 2006 $94
(b) Stationery: Paid during 2006 $370; Owing as at 31 December 2005 $110; Owing as at 31
December 2006 $245.

28.2 W. Hope’s year ended on 30 th June 2008. Write up the ledger accounts, showing the
transfers to the financial statements and the balances carried down to the next year for
the following:
(a) Stationery: Paid for the year to 30 th June 2008 $240; Inventory of stationery at 30 June
2007 $60; at 30 June 2008 $95
(b) General expenses: Paid for the year to 30 June 2008 $470; Owing at 30 June 2007 $32;
Owing at 30 June 2008 $60
(c ) Motor expenses: Paid in the year to 30 June 2008 $1410; Owing as at 30 June 2007 $92;
Owing as at 30 June 2008 $67.

Assuming that the central government decides to cut taxes by R100 billion to
stimulate the economy. The relevant marginal propensity to consume is 0.6 (60
percent). What will be the impact of such fiscal policy on equilibrium GDP?

Suppose that the real GDP increase by R5,000 billion when government
expenditure on the construction of new roads increase by R1,500 billion. What is
the value of the marginal propensity to consume?

Consider a monopolistic competitor who has the following demand function P=140-4Q. In addition suppose that his total cost function is given by TC=10+5Q2.
Required:
i) Find his equilibrium price (P) and quantity (Q). ​​​​
ii) What is his maximum profit? ​​​​​
b) Explain the features of monopolistic completion.​​​​]
REVISION QUESTION
a) A perfectly competitive firm is faced with the following total cost schedule
Q​= 0​1​2​3​4​5​6​7​8​9​10​

TC​= 9​20​30​39​47​54​60​67​77​90​109

Required:

(i) If the market price is $13, what output will the firm choose to produce to maximize profit? What is the maximum profit?

Assuming a private closed economy whereby the marginal propensity to
consume is 0.9 and investment spending decreases by R1000 billion. What will
be the change on equilibrium GDP?

f a R200 billion increases in investment spending creates R200 billion of new
income in the first round of the multiplier process and R160 billion in the second
round. Calculate:
a. the marginal propensity to consume (MPC).
b. the value of the expenditure multiplier in this closed economy.

Suppose the country of Macecon produces only two final goods, Theorems (Ts) and Lemmas (Ls). In 2018 it produced 10 Ts at a price of $50 and 50 Ls at a price of $10. In 2019 it produced 9 Ts at a price of $60 and 60 Ls at a price of $11. Using 2018 as the base year, the inflation rate in the GDP deflator between 2018 and 2019 was 5%.

Welfare effects when wage rate set below equilibrium