4.1 Examine two (2) main functions of money. 4.2 Differentiate between the wealth effect and interest rate effect as reasons for the downward sloping aggregate demand curve. 4.3 In terms of the diagram below discuss demand-pull inflation. Diagram attached. Please help me.
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4.1 Examine two (2) main functions of money.
4.2 Differentiate between the wealth effect and interest rate effect as reasons for the
downward sloping aggregate
4.3 In terms of the diagram below discuss demand-pull inflation.
Diagram attached. Please help me.
Step by step
Solved in 5 steps
- National Income DeterminationThe following figures are from data on Good Island EconomyItems $mNet private investment 940Depreciation 56Compensation of employees 2 256Corporate taxes 416Personal taxes 756Personal Consumption expenditure 4 386Government purchases 3 182Indirect business taxes minus subsidies 482Payment of factor income to the rest of the world 95Corporate profits minus dividends 56Government transfer payments and interest 243Exports 855Receipts of factor income from abroad 186Imports of goods and services 385Social insurance payments 332 Required: Use the above information to answer the followingi.) Calculate for Good Island:a. Gross private investment b. Gross Domestic product c. Gross National Product d. Net National Product e. National income f. Personal Income g. Disposable Personal IncomeAt Charlic's bakery, the MPL, is -12. Does this mean her average product must also be negative? Explain your answer.The table below gives the price and consumption (usage/sales) for two products xand yfor four years. Using year 2000 as the base year calculate for each year, thea) Basic expenditure index b) Laspeyers price index, and c) Paasche price index
- Which of the problems in the construction of theCPI might be illustrated by each of the followingsituations? Explain.a. the invention of cell phonesb. the introduction of air bags in carsc. increased personal computer purchases inresponse to a decline in their priced. more scoops of raisins in each package of RaisinBrane. greater use of fuel-efficient cars after gasolineprices increaseA basket of goods in 2005 costs $625; the same basket of goods cost $800 in 2010.What is the percentage change in the price level between 2005 and 2010? Question 7Answer a. -21.875% b. 28% c. 55% d. 0%Define what the Transportation Services Index (TSI) is. Then explain why the Freight TSI is procyclical (i.e. rises and falls with GDP).
- in table plzzCompute the GNP using the Income Approach and Expenditure Approach. Personal Consumption ExpendituresP 1,059,000 Compensation of employees and entrepreneurial & propertyIncome of persons980,000 Government Income31,000 Indirect Taxes132,500 Exports of goods and non-factor services648,200 Fixed Capital Formation232,400 Government Services116,000 Imports of goods and non-factor services648,100 Subsidies3,900 Trade237,000 Increase in Stocks7,200 Corporate Income16,000 Depreciation Allowance176,000 General Government Consumption Expenditures86,500 Net Factor Income From Abroad20,600Pls solve the gaps
- IF A2 2. What happens to domestic income in the AS–AD model when the price of a critical, imported, intermediate input suddenly falls? (Assume the demand for the input is inelastic.)Consider a macroeconomy where the current population is 800 thousand people. Gross domestic private investment is constant $2500 million while consumer expenditure is described by the equation: C = 580+ 0.8DI. The government is fairly active, with a total expenditure of $2000 million and net taxes of $2550 million. Further investigation of the macroeconomy reveals that imports are constant at $3000 million while exports are constant at $2500 million. Currently, the overall price level (GDP deflator) is 118 and the potential GDP level is $13.5 billion. What is the current equilibrium level of real GDP? (report your answer at 2 decimal places and in millions of dollars) 1. What is the current equilibrium level of real GDP 2. what is the current real GDP per capita? 3. what is the value gap?1. DBS Farms is a producer and retailer of farm products. DBS main products are Mangoes, Pawpaw and Pineapples. The current price of the Mangoes per Kilogram is GHS 50, the Pawpaw/Kg is GHS 80 and the Pineapple is GHS 40. This year the DBS Farms sold 10,000 kgs of Mangoes, 20,000 kgs of Pawpaw and 1 million kgs of Pineapples. In an attempt to improve revenue, the managers of the firm have decided to increase all prices by 10%. Market research has suggested that the price elasticity of demand for each product is: Mangoes: - 1.5; Pawpaw: -2.5; Pineapples: - 0.6. You have been asked to evaluate the planned price increases. Comment on the planned price changes. Would a 10% price reduction have been better for some or all of the products?
