Economics Answers

explain the significance of inflation and stock market indices to open economy as compared to a closed economy

3. In a circular flow of income and spending
a. the flow of income is in the same direction as the flow of spending.
b. the firms' spending represents the expenditure of the households.
c. the firms supply goods in the factor market and households buy these goods in the
goods market.

[1] None of the above statements
[2] a
[3] b
[4] c
[5] All the statements are correct

If you buy a car for $10,000 with a 3year loan at 8%interest, what is the total interest on the loan ?

What is the diffrent between macroeconomics and microeconomics ?

which country has absolute advantage in the production of maize?

Explain why cuts in public expenditure are likely to reduce aggregate demand?
Please explain this in detail.

Suppose, in a two sector model comprising consumers and firms, that the individuals receive the following payments for their provision of goods and services: wages K60000, interest K30000, rent K10000 and profits k8000. Consumption spending is K101000, planned investment expenditure is K20000 and actual investment expenditure is K7000.
a) What is the equilibrium output

If the discretionary income in a nation rises from $13 trillion to $15 trillion and consumption spending increases from $12 trillion to 13.5 trillion what is the marginal propensity to consume?

5. Which of the following statements regarding the balance of payments are correct?
a. When the South Africans export their financial and insurance services, this transaction
is entered in the financial account.
b. A current account surplus implies that the exports exceed the imports.
c. An appreciation of the rand will worsen the deficit on the current account of the balance
of payments.
[1] a and b
[2] a and c
[3] b and c
[4] b
[5] All the statements are correct.

Which one of the following regarding the demand for money is correct?
[1] The speculative demand for money is a function of the income level and the interest
rate.
[2] The transactions demand for money is inversely related to the interest rate.
[3] The position of the money demand curve is determined by the income level.
[4] An increase in interest rate will result in a decrease in the precautionary demand for
money.