Economics Answers

A. In the AD-AS model, an expansionary fiscal policy may lead to a........

1. Rightward shift of aggregate demand and demand-pull inflation
2. Leftward shift of aggregate demand and demand-pull inflation
3. Rightward shift of aggregate supply and cost-push inflation
4. Leftward shift of aggregate supply and cost-push inflation

A. If the government decides to increase personal income tax to raise its tax revenue, what will be the impact on the economy?

1. Both the price level and the equilibrium level of real output will decrease
2. Both aggregate demand and aggregate supply will increase
3. Price level will increase, and total production will decrease
4. Price level will decrease, and total production will increase

B. If the AS curve shifts to the left as productivity decreases, it will result in a combination of....

1. Lower output, higher unemployment, and higher inflation
2. Lower output, lower unemployment, and lower inflation
3. Higher output, lower unemployment and lower inflation
4. Higher output, higher unemployment, and higher inflation

the equilibrium level of income is R17000m. The full-employment income is R22000m and the marginal propensity to consume is 0,8. By how much should the investment expenditure change to bring national income to full-employment equilibrium

2. Suppose that Jones and Smith have each decided to allocate $1000 per year to an entertainment budget in the form of hockey games or rock concerts. They both like hockey games and rock concerts and will choose to consume positive quantities of both goods. However, they differ substantially in their preferences for these two forms of entertainment. Jones prefers hockey games to rock concerts, while Smith prefers rock concerts to hockey games.
a. Draw a set of indifference curves for Jones and a second set for Smith.
b. Using the concept of marginal rate of substitution, explain why the two sets of curves are different from each other

How can a country stop the devaluation of their currency during exogenous macroeconomic shock (COVID-19)?

A storm destroys half the wheat crop. Is this event more likely to hurt wheat farmers if the demand for wheat is very elastic or very inelastic? Explain.

Joana’s monthly income is $5000. She spends 40% of her income on grocery and the rest on buying designer clothes. The Provincial Government thinks it is unfair that people spend more than 35% of their income for grocery. In order to lower the proportion of income going to grocery, the Provincial Government gives Joana $500. Given that Joana’s income elasticity of grocery is 2, does the Provincial Government accomplished its goal? Support your answer.

choose
The uniqueness of utility up to a monotonic transformation, it confirms that
a. There is one utility function that can be used to represent the preference ordering.
b. Any preference ordering can be presented by many utility functions.
c. There is no utility function that can be used to represent the preference ordering.
d. Nothing mentioned above.

choose
derivative functions allow us to measure:
a. The rate of change of a variable over an infinite interval that is measurably large
b. The rate of change of a variable over a finite interval that is measurably large
c. The rate of change of a variable over a finite interval that is immeasurably small
d. The rate of change of a variable over an infinite interval that is measurably small