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Hi could you help me with the following MCQ questions?
When a currency crisis occurs, there is a(n) sharp __________ in the supply of the currency and a(n) sharp __________ in the demand for that currency.
1)increase; increase
2)increase; decrease // This is my answer
3)increase; no change
4)decrease; decrease
5)decrease; increase
If the U.S. inflation rate is 3 percent annually and the Japanese inflation rate is 1 percent annually, by what percent would the dollar price of the yen change annually according to purchasing power parity theory?
1)Depreciate by 1 percent
2)Appreciate by 1 percent
3)Appreciate by 2 percent
4)Depreciate by 2 percent
5)Appreciate by 3 percent
Not so sure about this
Expansionary monetary policy is strengthened in an open economy. What about expansionary fiscal policy?
1)Expansionary fiscal policy is strengthened, because the policy reduces the interest rate, which leads to currency depreciation, which increases net exports.
2)Expansionary fiscal policy is weakened, because the policy increases the interest rate, which leads to currency appreciation, which reduces net exports. // This is my answer
3)Expansionary fiscal policy is strengthened, because the policy increases the interest rate, which leads to currency depreciation, which increasee net exports.
4)Expansionary fiscal policy is unaffected in an open economy.
Is my answer correct?
When a currency crisis occurs, there is a(n) sharp __________ in the supply of the currency and a(n) sharp __________ in the demand for that currency.
1)increase; increase
2)increase; decrease // This is my answer
3)increase; no change
4)decrease; decrease
5)decrease; increase
If the U.S. inflation rate is 3 percent annually and the Japanese inflation rate is 1 percent annually, by what percent would the dollar price of the yen change annually according to purchasing power parity theory?
1)Depreciate by 1 percent
2)Appreciate by 1 percent
3)Appreciate by 2 percent
4)Depreciate by 2 percent
5)Appreciate by 3 percent
Not so sure about this
Expansionary monetary policy is strengthened in an open economy. What about expansionary fiscal policy?
1)Expansionary fiscal policy is strengthened, because the policy reduces the interest rate, which leads to currency depreciation, which increases net exports.
2)Expansionary fiscal policy is weakened, because the policy increases the interest rate, which leads to currency appreciation, which reduces net exports. // This is my answer
3)Expansionary fiscal policy is strengthened, because the policy increases the interest rate, which leads to currency depreciation, which increasee net exports.
4)Expansionary fiscal policy is unaffected in an open economy.
Is my answer correct?
Original post by KaiLaSO
Hi could you help me with the following MCQ questions?
When a currency crisis occurs, there is a(n) sharp __________ in the supply of the currency and a(n) sharp __________ in the demand for that currency.
1)increase; increase
2)increase; decrease // This is my answer correct, currency holders run to sell their currency increasing supply while demand cuts off - no one wants to buy a rapidly depreciating currency
3)increase; no change
4)decrease; decrease
5)decrease; increase
If the U.S. inflation rate is 3 percent annually and the Japanese inflation rate is 1 percent annually, by what percent would the dollar price of the yen change annually according to purchasing power parity theory?
1)Depreciate by 1 percent
2)Appreciate by 1 percent
3)Appreciate by 2 percent this one (not fully sure but PPP suggest that the exchange rate should equal (Foreign Price level/ Domestic Price level), so if we treat Foreign = US and Domestic = Japan, US price level has increased by 1.03, and Japanese by 1.01, dividing the two we get approx 1.02 (suggesting a 2% appreciation)
4)Depreciate by 2 percent
5)Appreciate by 3 percent
Not so sure about this at the very least you can rule out a depreciation, though: the dollar is getting less valuable (inflation erodes its value) vs. the yen, so we'll need more dollars to buy yen, meaning a higher dollar price for the yen.
Expansionary monetary policy is strengthened in an open economy. What about expansionary fiscal policy?
1)Expansionary fiscal policy is strengthened, because the policy reduces the interest rate, which leads to currency depreciation, which increases net exports.
2)Expansionary fiscal policy is weakened, because the policy increases the interest rate, which leads to currency appreciation, which reduces net exports. // This is my answer yep, it wil shift IS back in, nullifying fiscal policy completely
3)Expansionary fiscal policy is strengthened, because the policy increases the interest rate, which leads to currency depreciation, which increasee net exports.
4)Expansionary fiscal policy is unaffected in an open economy.
Is my answer correct?
When a currency crisis occurs, there is a(n) sharp __________ in the supply of the currency and a(n) sharp __________ in the demand for that currency.
1)increase; increase
2)increase; decrease // This is my answer correct, currency holders run to sell their currency increasing supply while demand cuts off - no one wants to buy a rapidly depreciating currency
3)increase; no change
4)decrease; decrease
5)decrease; increase
If the U.S. inflation rate is 3 percent annually and the Japanese inflation rate is 1 percent annually, by what percent would the dollar price of the yen change annually according to purchasing power parity theory?
1)Depreciate by 1 percent
2)Appreciate by 1 percent
3)Appreciate by 2 percent this one (not fully sure but PPP suggest that the exchange rate should equal (Foreign Price level/ Domestic Price level), so if we treat Foreign = US and Domestic = Japan, US price level has increased by 1.03, and Japanese by 1.01, dividing the two we get approx 1.02 (suggesting a 2% appreciation)
4)Depreciate by 2 percent
5)Appreciate by 3 percent
Not so sure about this at the very least you can rule out a depreciation, though: the dollar is getting less valuable (inflation erodes its value) vs. the yen, so we'll need more dollars to buy yen, meaning a higher dollar price for the yen.
Expansionary monetary policy is strengthened in an open economy. What about expansionary fiscal policy?
1)Expansionary fiscal policy is strengthened, because the policy reduces the interest rate, which leads to currency depreciation, which increases net exports.
2)Expansionary fiscal policy is weakened, because the policy increases the interest rate, which leads to currency appreciation, which reduces net exports. // This is my answer yep, it wil shift IS back in, nullifying fiscal policy completely
3)Expansionary fiscal policy is strengthened, because the policy increases the interest rate, which leads to currency depreciation, which increasee net exports.
4)Expansionary fiscal policy is unaffected in an open economy.
Is my answer correct?
Answers in bold above^
Hi guys, I'm not pretty confident to answer these questions below, can anyone help please? Thanks very much!
1.Based on your understanding of the aggregate supply and aggregate demand model and the IS-LM model, graphically illustrate and explain what effect a reduction in the price of oil will have on the economy. In your graphs, clearly illustrate the short-run and medium-run equilibria. Also include in your answer an explanation of the effects of this change in the price of oil on the labour market and the equilibrium real wage.
2. Inflation in Zimbabwe reached hyper inflation level a few years ago. President Mugabe then blamed Western governments for restricting trade and driving up prices.
a) Could a fall in supply have generated sustained high inflation?
b) Why do you think Zimbabwe had such high inflation for a long period of time?
1.Based on your understanding of the aggregate supply and aggregate demand model and the IS-LM model, graphically illustrate and explain what effect a reduction in the price of oil will have on the economy. In your graphs, clearly illustrate the short-run and medium-run equilibria. Also include in your answer an explanation of the effects of this change in the price of oil on the labour market and the equilibrium real wage.
2. Inflation in Zimbabwe reached hyper inflation level a few years ago. President Mugabe then blamed Western governments for restricting trade and driving up prices.
a) Could a fall in supply have generated sustained high inflation?
b) Why do you think Zimbabwe had such high inflation for a long period of time?
how ethical issues affect the achievement of government objectives? 
Apparently there is a new Edexcel specification for 2016?
If I am retaking Units 1&2 will I have the new exam style paper or is there a separate one for retaking students?
If I am retaking Units 1&2 will I have the new exam style paper or is there a separate one for retaking students?
Please check this out.
http://www.thestudentroom.co.uk/showthread.php?t=4085791&p=64820871#post64820871
Thanks
http://www.thestudentroom.co.uk/showthread.php?t=4085791&p=64820871#post64820871
Thanks
Please may someone help answer these questions. Just a guideline will really help out as I have an exam tomorrow.
Thanks a lot xxxx
Section B Microeconomics.
21. Explain the welfare impact of international trade on the exporting country. Show on the diagram the welfare gains/losses to producers and consumers as compared to the no-trade situation.
23. Explain why accountants in the public sector are often paid less than accountants in the private sector.
24. Give two examples of excludable but non-rival goods. Should the government provide these goods, and why?
25. When and how can the firm with market power use first-degree price discrimination?
Section C Macroeconomics
26. Use Phillips curve analysis to explain why many central banks are independent of government.
27. Use aggregate demand and supply analysis to show how a reduction in the rate of interest affects output and the price level.
29. Discuss ways in which a government could raise the level of real GDP per capita in the long run.
Thanks a lot xxxx
Section B Microeconomics.
21. Explain the welfare impact of international trade on the exporting country. Show on the diagram the welfare gains/losses to producers and consumers as compared to the no-trade situation.
23. Explain why accountants in the public sector are often paid less than accountants in the private sector.
24. Give two examples of excludable but non-rival goods. Should the government provide these goods, and why?
25. When and how can the firm with market power use first-degree price discrimination?
Section C Macroeconomics
26. Use Phillips curve analysis to explain why many central banks are independent of government.
27. Use aggregate demand and supply analysis to show how a reduction in the rate of interest affects output and the price level.
29. Discuss ways in which a government could raise the level of real GDP per capita in the long run.
HI guys please help me understand how to calculate the answer for the following question
A good has a unitary price elasticity of demand and at a price of $20 a firm sells 40000 units. how many wiil the firm sell if it charges a price of $5?
A good has a unitary price elasticity of demand and at a price of $20 a firm sells 40000 units. how many wiil the firm sell if it charges a price of $5?
Can someone please explain how an increase in agregate demand leads to inflation, I understand it diagrammatically but cannot work out the theory behind it? @bagdsy0
I'm stuck seeing if anyone could helpI don't understand the different between perfectly competitive labour market and imperfecty competitive labour marketsAlso does imperfect competition mean anything but perfect competition? Sound pretty simple but this is one thing i'm confused about
Original post by mapuleng
HI guys please help me understand how to calculate the answer for the following question
A good has a unitary price elasticity of demand and at a price of $20 a firm sells 40000 units. how many wiil the firm sell if it charges a price of $5?
A good has a unitary price elasticity of demand and at a price of $20 a firm sells 40000 units. how many wiil the firm sell if it charges a price of $5?
answer is 10,000. just use the equation so ped=40000/20 which gives you elasticity of 2000. sub it in with the different price to get 5 x 2000= 10,000
Original post by minibailey27
thank you. that kind of helps, but the question just asks for a straightforward comparison of their diagrams.
10 marks involves some evaluation so it is not just straightforward like that - you also have to define them and say what they do/are for 2 - 3 marks.
Attachment not found
Attachment not found
Thanks
(Question b)
Hey! Just wondering if anyone doing the AQA new spec (2015), knows of the best revision guide / text book to buy, in order to get a high grade (A), because I don't fancy buying a £25 book to find out its rubbish!
(
Thanks alot
(
Thanks alot
I am having some trouble understanding the multiplier effect. There are two main things I don't understand:
1) The effect is explained with an example in which there is a £100 million increase in investment. A firm receives the money from the investment. All of the money is then passed onto households. The households withdraw some of the money, in this case at a rate of 0.1, meaning £90 million flows back to firms. What I don't understand is why ALL the money firms receive must flow back to households, and why when calculating the multiplier, you only take into account the MPW of households. Surely firms save, import and pay taxes. Why are these withdrawals not included in the model?
2) I was taught beforehand that the MPC and the MPS must equal 1, as income is either spent or saved. Why is it then that the value of the multiplier is 1/1-MPC or 1/MPW, which suggests that the MPC and the MPW equal one. This makes more sense, but why was I taught it in terms of the MPS and MPC equalling 1 beforehand?
Thanks in advance for any help. I understand the concept in general but just a few details don't seem to make sense.
1) The effect is explained with an example in which there is a £100 million increase in investment. A firm receives the money from the investment. All of the money is then passed onto households. The households withdraw some of the money, in this case at a rate of 0.1, meaning £90 million flows back to firms. What I don't understand is why ALL the money firms receive must flow back to households, and why when calculating the multiplier, you only take into account the MPW of households. Surely firms save, import and pay taxes. Why are these withdrawals not included in the model?
2) I was taught beforehand that the MPC and the MPS must equal 1, as income is either spent or saved. Why is it then that the value of the multiplier is 1/1-MPC or 1/MPW, which suggests that the MPC and the MPW equal one. This makes more sense, but why was I taught it in terms of the MPS and MPC equalling 1 beforehand?
Thanks in advance for any help. I understand the concept in general but just a few details don't seem to make sense.
i am really struggling with these revision questions and was wondering if anyone could provide me with some help
A monopolists’s demand function is given by p +q = 100 Write down expressions for tr and mr in terms of q and sketch their graphs. Find the value of which gives a marginal revenue of zero and comment on the significance of this value. If the average cost function of a good is ac =15/q +2q+9 find an expression for TC What are the fixed costs in this case? Write down an expression for the marginal cost function. 3) If the supply equation is q = 7 + 0.1p + 0.004p2 find the price elasticity of supply if the current price is 80. is supply elastic or inelastic at this price and estimate the percentage change in supply if the price rises by five percent
A monopolists’s demand function is given by p +q = 100 Write down expressions for tr and mr in terms of q and sketch their graphs. Find the value of which gives a marginal revenue of zero and comment on the significance of this value. If the average cost function of a good is ac =15/q +2q+9 find an expression for TC What are the fixed costs in this case? Write down an expression for the marginal cost function. 3) If the supply equation is q = 7 + 0.1p + 0.004p2 find the price elasticity of supply if the current price is 80. is supply elastic or inelastic at this price and estimate the percentage change in supply if the price rises by five percent
If a government imposes a minimum wage policy for workers in factories that produce computes but not on ones that produce computers’ accessories. What would be the effect of such a policy on the wages and products’ prices in these two industries in both the short and the long run?
I didn't do econ at a-level so forgive me if this is basic stuff
I didn't do econ at a-level so forgive me if this is basic stuff
For normal goods and inferior goods, how do you know where the indifference curves go? For example, when price decreases of a good, why does for a normal good the new indifference curve is further up compared to an inferior good whose indifference curve is drawn further down (I know this is a bad explanation but if someone could just explain the reasoning to why the indifference curves are where they are)
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