Exam 2012 with memo.pdf

8/17/2019 Exam 2012 with memo.pdf

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UNIVERSITY OF THE FREE STATE/ UNIVERSITEIT VAN DIE VRYSTAAT

MAIN CAMPUS / HOOFKAMPUS

EECF62306

DEPARTMENT: ECONOMICS

DEPARTEMENT: EKONOMIE

CONTACT NUMBER: KONTAKNOMMER: 401 3406/ 9196

MAIN YEAR-END EXAMINATION: NOVEMBER 2012

HOOFJAAREINDEKSAMEN: NOVEMBER 2012

ASSESSOR(E): Mrs/ Mev. C. Campher; Mrs/ Mev. C. DuvenhageASSESSOR(S): Mr/ Mnr . S. Guvuriro; Mr./ Mnr. C. Mudzingiri

MODERATOR: Mr/ Mnr N. Keyser

TIME / TYD: 2 hours/ ure MARKS / PUNTE: 100

INSTRUCTIONS:

• This paper consists of 5 questions on 6 pages.

• Answer all the questions.

• Read each question carefully and please write legibly.

• For questions 2 to 5, show all necessary calculations and label all graphs clearly.

QUESTION 1 (2 x 20 = 40)

Answer Question 1 in your answer book. Write the letter of your choice next to the

question number (e.g. 1.1 A or 1.1 B).

1.1 The ease with which an asset can be converted into a medium of exchange is known as:A. VolatilityB. LiquidityC. CurrencyD. Speculative exchange

1.2 If a market basket of goods cost R150 in the base year and R450 in a year later, then theprice index for the latter year would beA. 150B. 3C. 300D. 450

1.3 Assume a simplified banking system in which all banks are subject to a uniform reserverequirement of 20 percent and checkable deposits are the only form of money. A bankthat received a new checkable deposit of R10 000 would be able to extend new loans upto a maximum of:


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A. R50 000B. R12 000C. R10 000D. R8 000

1.4 When the required reserve ratio ……., the money multiplier …….such that the moneysupply …………… and it is a(an) ………monetary policy.A. decreases; increases; increases; contractionaryB. decreases; decreases; increases; expansionaryC. decreases; increases; increases; expansionaryD. decreases; decreases; decreases; expansionary

1.5 If the MPC is 0.78, this means that:A. for every rand earned, 78 cents are saved.B. goods in the economy are in very high demand.C. 78% of income is used for consumption.

D. interest rates will increase by 7.78%.

1.6 If the price level rises,A. the exchange rate will fall and net exports will fall.B. the exchange rate will fall, and net exports will rise.C. the exchange rate will rise, and net exports will fall.D. the exchange rate will rise, and net exports will rise.

1.7 The graph below illustrates the foreign exchange market for Rand and US$

The graph shows a situation in whichA. both the dollar and the rand have depreciated.B. both the dollar and the rand have appreciated.C. the dollar has depreciated and the rand has appreciated.D. the dollar has appreciated and the rand has depreciated.

1.8 If C = 40 + 0.8Y; I = 60 – 2i; and interest rates (i) = 10. Assuming this is a closed andprivate economy, the amount that the business will want to invest will be…… and theequilibrium income will be……..

A. 32; 72

B.

40 ; 400

Quantity of US$ (millions per day)300 100

7.46

7.80

8.34

D2

S1

S2

D1

Price

(Rands perdollar)

500

E2

E1


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C. 60 ; 600D. 80; 800

1.9 A rightward shift in aggregate demand curveA. can increase output, employment and the price level.

B. will increase output but not the price level.C. should lead to an increase in the potential income of the society.D. is the result of a contractionary fiscal policy.

1.10 Which of the following statements is true?A. A speculative motive for holding money is completely interest-rate inelastic.B. A transaction motive for holding cash is completely interest-rate elastic.C. A precautionary motive for holding cash is completely interest-rate inelastic.D. A precautionary motive for holding cash is completely interest-rate elastic.

1.11 Consider the Aggregate Supply (AS) curve shown below:

A. The region ab of the AS curve reflects a range of high levels of demand-pull inflation.B. The region ab of the AS curve reflects that policymakers/economists are faced with

trade-off condition.C. The region bc of the AS curve reflects that policymakers/economists are faced with

trade-off condition.D. The region ab of the AS curve reflects that the economy is experiencing full

employment.

1.12 Only three goods are produced in an economy in the following amounts: A = 10, B =30 and C = 5. The current year per unit prices of these three goods are: A = R2, B = R3,

and C = R1. Referring to this information, we can say that real GDP in the current year is:A. R45B. R115C. R270D. undefined.

1.13 Suppose there are 10 million part-time workers and 90 million full-time workers in aneconomy. Five million of the part-time workers switch to full-time work. As a result:A. the official unemployment rate will fall.B. the official unemployment rate will rise.C. the official unemployment rate will remain unchanged.

D.

the size of the labour force will increase.

a b

c

Y

CPI AS


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1.14 If a box of Swiss chocolate priced at 100 francs can be purchased for R50, theexchange rate is:A. 0.50 francs per Rand.B. 4.00 francs per Rand.

C. 0.50 Rand per franc.D. 1.00 franc per Rand.

1.15 If the rand is depreciating, the South African Reserve Bank could strenghten the valueof the rand by:

A. buying foreign currency on the foreign exchange market.B. selling rands on the foreign exchange market.C. selling foreign currency on the foreign exchange market.D. decreasing the South African interest rate.

1.16 If South Africans dramatically increase imports from the USA, we would expect the

A. supply of dollars to increase and the Rand to appreciate.B. demand for dollars to increase and the Rand to appreciate.C. supply of dollars to increase and the Rand to depreciate.D. demand for dollars to increase and the Rand to depreciate.

1.17 If 2000 is the base year for real GDP calculations, we know for certain that nominalGDPA. is less than real GDP in 2000B. is greater than real GDP in 2000C. equals real GDP in 2000D. in 1999 will be greater than real GDP in 2000

1.18Automatic stabilizers “lean against the prevailing wind” of the business cycle because:A. wages are controlled by the minimum wage law.B. government expenditures and tax revenues change as the level of real GDP changes.C. the spending and tax multipliers are constant.D. they include the power of special interest.

1.19When the SARB increases the REPO rateA. borrowing from SARB becomes very cheap for private banks.B. borrowing from SARB becomes expensive.

C.

bonds market stop existing.D. open market operations increase.

1.20Bank A receives a deposit of R18 000 from person W. From this deposit, Bank A lendsmaximum permissible amount to person X of R14 400. Person X went on to make adeposit of R14 400 with his bank B. Bank B lends its maximum permissible of R11 520to person Z. The required reserve ratio in this country is

A. 80%B. 20%C. Cannot be determinedD. 15%


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QUESTION 2 (11)

2.1 Carefully study the information provided in the table below and answer the questionswhich follow:

Year Real GDP (million) Nominal GDP (million) Population (million)

1989 258 254 301990 265 265 35.5

1991 270 310 40.2

1992 260 340 43

2.1.1 Which year represents the base year? [1]2.1.2 Calculate the per capita growth rate for1991 and 1992. [4]

2.2 If the population figure that is provided in year 1992 comprises of the following:Working age population 30 millionNumber of people employed 10 million

Number of people unemployed 5 millionNot economically active 15 millionNon working age population 13 millionOut of the 15 million people not economically active, 3 million are discouraged workseekers.

2.2.1 Calculate the size of the labour force according to the expanded definition ofunemployment. [2]

2.2.2 What is the unemployment rate based on the strict definition? [2]2.2.3 Who are “discouraged” work seekers? [2]

QUESTION 3 [21]

3.1 Suppose the following information is made available regarding the South Africaneconomy:

S = - 200 + 0.35YI = 350G = 458X = 140M = 0.1YT = 0.15YWhere S = savings, I = investment spending, G = government spending, X = exports, M =imports, T = taxes, and Y = income.

3.1.1 State and interpret the marginal propensity to consume (mpc). [2]3.1.2 Write down the net export (NX) function and calculate the level of income when there

is a balance in the current account of the Balance of Payment Statement. [3]3.1.3 Graphically illustrate the NX function indicating clearly its value when income is

zero. [3]3.1.4 Calculate and write down the Total Expenditure function of this economy. [2]


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3.2 The aggregation of expenditures of key economic players of an economy calledAyoba-land gives the following Total Spending (TE) function:

TE = 790 + 0.60Y

3.2.1 Calculate the equilibrium level of income for Ayoba-land economy. [2]

3.2.2 Calculate and interpret the expenditure multiplier. [3]3.2.3 Suppose the government of this economy embarks on a discretionary fiscal policy and

increases its spending by 50. Graphically show, using well labeled Keynesian model,the impact of this action on autonomous expenditure and equilibrium income. [6]

QUESTION 4 [20]

4.1 Assume South Africa’s inflation rate increases to 11%.4.1.1 Identify one instrument that the SA government can use to bring the inflation rate down

back to the target range of 3-6%. [1]

4.1.2 Illustrate, by making use of a graph, the impact of the above action in 4.1.1 on the realsector of the economy. [3]

4.2 Make use of a complete Keynesian Transmission Mechanism chain reaction, as well as allnecessary graphs, to explain and illustrate the impact of an increased repo rate on themonetary and real sectors of the economy. [10]

4.3 The table below provides information from the World Bank on the Gini coefficients forfor South Africa and Canada:

Year Country Gini coefficient

2000 South Africa 0.5782000 Canada 0.326

4.3.1 Illustrate the Lorenz curves for the two countries on the same graph and compare thelevel of income inequality in these two countries [6]

QUESTION 5 [8]

5.1 Consider the rand/dollar exchange rate, and focus on the market for dollars. Using thedemand and supply curves, explain whether the dollar would appreciate or depreciate againstthe rand, and whether that rand would appreciate or depreciate against the dollar if thefollowing things happened:5.1.1 More foreign tourists visit South Africa. [4]5.1.2 South Africa discovers a large oil field off the coast of Durban and as a result our oilimports decrease substantially. [4]

End


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EECF62306






ASSESSOR(E): Mrs/ Mev. C. Campher; Mrs C. DuvenhageASSESSOR(S): Mr/ Mnr . S. Guvuriro; Mr. C. Mudzingiri



INSTRUKSIES:

• Hierdie vraestel bestaan uit 5 vrae op 7 bladsye.

• Beantwoord al die vrae.

• Lees elke vraag noukeurig en skryf netjies.

• Vir vrae 2 tot 5, dui alle nodige berekeninge en merk alle grafieke duidelik.

VRAAG 1 (2 x 20 =40)

Beantwoord Vraag 1 in u antwoordboek. Skryf die letter van u keuse langs die betrokke

vraagnommer neer (bv. 1.1 A of 1.1 B).

1.1 Die gemak waarmee 'n bate kan omskep word in 'n ruilmiddel staan bekend as:A. VolatiliteitB. LikiditeitC. GeldeenheidD. Spekulatiewe ruil

1.2 Indien 'n mark mandjie van goedere R150 in die basisjaar kos en R450 kos 'n jaar later,dan sal die prysindeks vir die laaste jaar wees:A. 150B. 3C. 300D. 450

1.3 Veronderstel 'n vereenvoudigde bankstelsel waarin al die banke onderworpe is aan 'neenvormige reserwevereiste van 20 persent en kontroleerbare deposito's is die enigstevorm van geld. 'n Bank wat 'n nuwe kontroleerbare deposito van R10 000 ontvang sal instaat wees om nuwe lenings te kan skep tot 'n maksimum van:


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A. R50 000B. R12 000C. R10 000D. R8 000

1.4 Wanneer die vereiste reserwe-verhouding ............, sal die kredietvermenigvuldiger .......,van so 'n aard dat die geldvoorraad ............... en dit is dan ‘n ......... monetêre beleid.A. daal, toeneem, toeneem, inkrimpendeB. daal, daal, toeneem, ekspansionistieseC. daal, toeneem, toeneem, ekspansionistieseD. daal, daal, daal, ekspansionistiese

1.5 Indien die MPC gelyk is aan 0.78, beteken dit:A. 78 sent vir elke rand wat verdien word, word gespaar.B. goedere in die ekonomie is in 'n baie hoë aanvraag.C. 78% van inkomste word verbruik.

D. rentekoerse sal met 7.78% styg.

1.6 Indien pryse styg, sal:A. die wisselkoers val, en netto uitvoere sal daal.B. die wisselkoers val, en netto uitvoere sal styg.C. die wisselkoers styg, en netto uitvoere sal daal.D. die wisselkoers styg, en netto uitvoer sal styg.

1.7 Die grafiek hieronder illustreer die buitelandse valutamark vir Rand en US $

Die grafiek toon 'n situasie waarin

A. beide die dollar en die rand gedepresieer het.B. beide die dollar en die rand geappresieer het.C. die dollar gedepresieer het en die Rand geappresieer het.D. die dollar geappresieer het en die rand het gedepresieer.

1.8 Indien C = 40 + 0.8Y; I = 60 – 2i; en die rentekoers (i) = 10. Veronderstel hierdie is ‘n

geslote en privaat ekonomie, sal die hoeveelheid wat die firma’s sal investeer …….wees

en die ewewigsinkomste sal ……… wees.

E. 32; 72

F. 40 ; 400

G. 60 ; 600

S1

S2

Prys (Randper dollar)

Hoeveelheid US$ (mil per dag)

E1

E2

8.34

7.80

7.46

100 300 500


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H. 80; 800

1.9 ‘n Regswaartse skuiwing van die totale vraagkurweA. kan produksie, indiensname en die prysvlak laat styg.B. sal uitsette verhoog, maar nie die prysvlak.

C. behoort te lei tot 'n toename in die potensiële inkomste van die samelewing.D. is die gevolg van 'n beperkende fiskale beleid.

1.10 Watter van die volgende stellings is waar?A. 'n Spekulatiewe motief vir die hou van geld is heeltemal rente onelasties.B. 'n Transaksie motief vir die hou van geld is heeltemal rente elasties.C. 'n Voorsorgmotief vir die hou van geld is heeltemal rente onelasties.D. ‘n Voorsorgmotief vir die hou van geld is heeltemal rente elasties.

1.11 Beskou die totale aanbodskurwe (AS) kurwe hieronder getoon:

A. Die area ab van die AS-kurwe toon 'n reeks van hoë vlakke van vraagtrek-inflasie.

B. Die area ab van die AS-kurwe toon dat beleidmakers / ekonome met ‘n afruiling

(trade-off) toestand in die gesig gestaar word.

C. Die area bc van die AS-kurwe toon dat beleidmakers / ekonome met ‘n afruiling

(trade-off) toestand in die gesig gestaar word.

D. Die streek ab van die AS-kurwe dui daarop dat die ekonomie volle indiensname

ervaar.

1.12

Slegs drie produkte word geproduseer in 'n ekonomie in die volgende hoeveelhede: A =10, B = 30 en C = 5. Die per eenheid pryse van hierdie drie produkte in die huidige jaaris: A = R2, B = R3, en C = R1. Met verwysing tot hierdie inligting, kan ons sê dat diereële BBP in die huidige jaar is:

A. R45B. R115C. R270D. ongedefineerd.

1.13 Veronderstel daar is 10 miljoen deeltydse werkers en 90 miljoen voltydse werkers in 'nekonomie. Vyf miljoen van die deeltydse werkers skakel oor na voltydse werk. As 'n

gevolg hiervan sal:

AS

c

ba

Y

VPI


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A. die amptelike werkloosheidskoers val.B. die amptelike werkloosheidskoers styg.C. die amptelike werkloosheidskoers onveranderd bly.D. die grootte van die arbeidsmag sal toeneem.

1.14 Indien 'n boks van Switserse sjokolade teen 100 frank gekoop kan word vir R50, is diewisselkoers:A. 0,50 frank per Rand.B. 4,00 frank per Rand.C. 0,50 Rand per frank.D. 1,00 frank per Rand

1.15 Indien die rand depresieer, kan die Suid-Afrikaanse Reserwebank die waarde van dierand versterk deur:A. die aankoop van buitelandse valuta op die buitelandse valutamark.B. Die verkoop van rande op die buitelandse valutamark.

C. die verkoop van buitelandse valuta op die buitelandse valutamark.D. die Suid-Afrikaanse rentekoers te verlaag.

1.16 Indien Suid-Afrikaners se invoere van die VSA dramaties sou verhoog, sou ons verwagdat die

A. aanbod van die dollar sal toeneem en die Rand sal appresieer.B. vraag na die dollar sal toeneem en die Rand sal appresieer.C. aanbod van die dollar sal toeneem en die Rand sal depresieer.D. vraag na die dollar sal toeneem en die Rand sal depresieer.

1.17 Indien 2000 die basisjaar is vir reële BBP-berekeninge, weet ons vir seker dat nominaleBBPA. minder is as die reële BBP in 2000.B. groter is as die reële BBP in 2000.C. gelyk is aan die reële BBP in 2000.D. in 1999 sal groter wees as die reële BBP in 2000.

1.18 Outomatiese stabiliseerdes "leun teen die heersende wind" van die sakesiklus omdat:A. lone beheer word deur die minimumloonwet.B. regering uitgawes en belasting inkomste verander soos die vlak van die reële BBPverander.

C. die besteding en belastingvermenigvuldigers is konstant.D. dit die effek van spesiale rente insluit.

1.19 Wanneer die SARB die repokoers verhoogA. word lenings van die SARB baie goedkoop vir private banke.B. word lenings van die SARB duur.C. die effektemark hou op om te bestaan.D. opemarktransaksies neem toe.

1.20 Bank A ontvang ' n deposito van R18 000 van persoon W. Van hierdie deposito, leenBank A die maksimum toelaatbare bedrag aan persoon X van R14 400. Persoon X maak


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'n deposito van R14 400 by sy bank B. Bank B leen die maksimum toelaatbare bedragvan R11 520 aan persoon Z. Die vereiste reserwe verhouding in hierdie land is:E. 80%F. 20%G. Kan nie bereken word nie.

H. 15%

VRAAG 2 (11)

2.1 Bestudeer die inligting in die tabel hieronder en beantwoord die vrae wat volg:

Jaar Reële BBP (miljoen) Nominale BBP(miljoen)

Bevolking (miljoen)

1989 258 254 30

1990 265 265 35.5

1991 270 310 40.2

1992 260 340 43

2.2.4 Watter jaar verteenwoordig die basis jaar? [1]2.2.5 Bereken die groeikoers per kapita vir 1991 en 1992. [4]

2.3 Veronderstel dat die bevolkingsgetal wat in die tabel verskaf word vir 1992 uit dievolgende bestaan:Werkende ouderdom bevolking 30 miljoenHoeveelheid mense indiensgeneem 10 miljoenHoeveelheid mense werkloos 5 miljoenNie ekonomies aktief 15 miljoenNie werkende ouderdom bevolking 13 miljoenVan die 15 miljoen mense wat nie economies aktief is nie, is 3miljoen ontmoedigdewerkers.

2.3.1 Bereken die grootte van die arbeidsmag in terme van die uitgebreide definisie vanwerkloosheid. [2]

2.3.2 Wat is die werkloosheidskoers in terme van die streng definisie? [2]2.3.3 Wat is “ontmoedigde” werkers? [2]

VRAAG 3 [21]

3.1 Die volgende inligting word beskikbaar gestel met betrekking tot die Suid-Afrikaanseekonomie:

S = - 200 + 0.35YI = 350G = 458X = 140M = 0.1YT = 0.15YWaar S = spare, I = investering, G = regeringsbesteding, X = uitvoere, M = invoere, T =

belasting, and Y = inkomste.


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3.1.1 Skryf neer en interpreteer die marginale geneigdheid om te verbruik (mpc). [2]3.1.2 Skryf die netto uitvoer (NX) neer as ŉ funksie van inkomste (Y) en bereken die

inkomstevlak wanneer die handelsrekening van die Betalingbalans gebalanseer is. [3]3.1.3 Illustreer grafies die netto uitvoer funksie en dui duidelik die waarde aan wanneer

inkomste gelyk is aan nul.[3]

3.1.4 Bereken en skryf neer die Totale Bestedingsfunksie van hierdie ekonomie. [2]

3.2 Die opsomming van die uitgawes van die belangrikste ekonomiese rolspelers van dieekonomie genoem Ayoba-land gee die volgende Totale besteding (TE) funksie:

TE = 790 + 0.60Y

3.2.1 Bereken die ewewigsvlak van inkomste vir die ekonomie van Ayoba-land. [2]3.2.2 Bereken en interpreteer die bestedingsvermenigvuldiger. [3]3.2.3 Veronderstel dat die regering van hierdie ekonomie 'n diskresionêre fiskale beleid

aanvaar en sy besteding met 50 verhoog. Deur gebruik te maak van die Keynesiaansemodel, toon grafies die uitwerking aan van hierdie aksie op outonome besteding enekwilibrium inkomste.

[6]

VRAAG 4 [20]

4.1 Veronderstel Suid Afrika se inflasiekoers styg na 12%.4.1.1 Identifiseer 1 instrument wat die Suid Afrikaanse regering kan gebruik om die inflasie

terug na die teikenkoers van tussen 3% en 6% te laat daal. [1]4.1.2 Illustreer, deur gebruik te maak van ‘n grafiek die impak van die aksie in 4.1.1 op die

reële sektor van die ekonomie. [3]

4.2 Maak gebruik van ‘n volledige Keynesiaanse Transmissie Meganisme kettingreaksie,sowel as al die nodige grafieke, om die impak van ‘n toename in die repokoers op diereële en monetêre sektore van die ekonomie te verduidelik en illustreer.

[10]

4.3 Die tabel hieronder verskaf inligting van die Wêreldbank op die Gini-koëffisiënte virSuid-Afrika en Kanada:

Jaar Land Gini koëffisiënt2000 Suid Afrika 0.578

2000 Kanada 0.326

4.3.1 Illustreer die Lorenz-kurwes vir die twee lande op dieselfde grafiek en vergelyk die vlakvan inkomste-ongelykheid in hierdie twee lande. [6]

VRAAG 5 [8]

5.1 Neem die rand / dollar-wisselkoers in ag, en fokus op die mark vir dollars. Deur gebruikte maak van die vraag-en aanbodkurwes, verduidelik of die dollar sal appresieer of


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depresieer teen die rand, en of die rand sou appresieer of depresieer teenoor die dollar asdie volgende dinge gebeur:

5.1.1 Meer buitelandse toeriste besoek Suid Afrika. [4]5.1.1 Suid-Afrika ontdek 'n groot olie-veld van die kus van Durban af, en as gevolg daarvan

is daar ‘n aansienlike daaling van ons olie-invoere. [4]

EINDE


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EECF62306






MEMORANDUM


QUESTION 1 (2 x 20 = 40)

1.1 B

1.2 C

1.3 D

1.4 C

1.5 C

1.6 C

1.7 C

1.8 B

1.9 A

1.10 C

1.11 C

1.12 B

1.13 C

1.14 C

1.15 C

1.16

D

1.17 C

1.18 B

1.19 B

1.20 B


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QUESTION 2 (11)2.1.1 1990

2.1.2 Per capita growt rate !or 1991 "%03.10%100*

5.35265

)5.35

265()

2.40

270(

−=

−

Per capita growt rate !or 1992 " %97.9%100*

2.40

270

)2.40

270()

43

260(

−=

−

2.2.1 #a$o%r !orce " &'e(p)o*e+ , -(p)o*e+

" 5 %'e(p/ , 3 +ico%rage+/ , 10 e(p)/

" 18(i))io'

2.2.2 &'e(p)o*(e't rate " &'e(p)o*e+#a$o%r !orce/ 100

" 5 15/ 100

" 33.33

2.2.3 Dico%rage+ worer %'e(p)o*e+ pero' wo are 'ot actie)* earci'g !or a o$.

&'e(p)o*e+ pero' wo ae gie' %p te o$ earc.

QUESTION 3 (21)

3.1.1 PC " 1 PS " 1 0.35 " 0.65

:or eer* o'e ra'+ i'creae i' i'co(e 65 ce't i pe't o' co'%(ptio'

3.1.2 ;< " < ="> ;< " 140 0.1Y

Ba)a'ce i' te c%rre't acco%'t < " . So 140 " 0.1Y ="> Y " 1 400

3.1.3

Clear labels of axes

3.1.4 ?- " C , I , @ , <

?- " 200 , 0.65 Y 0.15Y/ , 350 , 458 , 140 0.1Y

?- " 1148 , 0.4525Y

140

1 400

;< " 140 0.1Y

Y

;<


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3.2

3.2.1 ?- " 790 , 0.6Y

0.4Y" 790

Y " 1975

3.2.2 -pe'+it%re (%)tip)ier " 11(pc

" 110.6

" 10.4

" 2.5

I'terpretatio' It (ea%re te rate o! ca'ge i' o%tp%t or i'co(e +%e to a ca'ge i' a'* o'e o! te

a%to'o(o% pe'+i'g.

3.2.3

790

840

?- " 790 , 0.60Y

?- " 840 , 0.60Y

?- " Y

Y

?-

1975 2100


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QUESTION 4 (20)

4.1

4.1.1 i'creae tae OR +ecreae goer'(e't pe'+i'g 1/

4.1.2

(3)

for correct labels of axes and curves

OR

for correct labels of axes and

curves

Y

?-

?-1

?-0

?- " Y

AS

AD1

AD0

ea) @DP

Aerage

Price

Y1Y0

A%to ?-1

A%to ?-0

Y1 Y0

P0

P1


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4.2

• Economic variable: i' →

• Monetary sector: → ortage i' (o'e* (aret → &pwar+ pre%re o' i'teret

rate → i'teret rateE →

• Link: E i' i'teret rate → i' I

• Real: i' I → i' ?- → i' AD → E i' toc → %rp)% i' te (aret → i'

price → i' pro+%cFo' → i' Y.

(1)

1

+ I

?-1

?- AS

AD

AD1

i

G o!

i

I

Y-

?-

ea) @DP

CPI


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19

4.3.1 for correct labels

Using either the gini coefficients or the Lorenz curves, the level of income inequality is

higher in South Africa than in Canada

QUESTION 5 (8)

5.1.1

+o))ar wi)) +epreciate a'+ ra'+ wi)) appreciate

(4)

(minus 1 if graph not labelled correctly)

a'+ per H

S0 o! H

D !or H

G%a'tit* o! H

S1 o! H

S o! H

#ore' c%re !orCa'a+a

#ore' c%re !or

So%t A!rica

C%(%)atie perce'tage o!

pop%)atio'

C%(%)atie

age

i'co(e

0

P-#

GH0 GH1

-1

-0

! !


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20

5.1.2

Do))ar wi)) +epreciate a'+ ra'+ wi)) appreciate

(4)

(minus 1 if "ra#$ not labelled correctly)

D0 !or HD1 !or H

! !

GH1 GH0

-1

-0

G%a'tit* o! H


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21

UNIVERSITEIT VAN DIE VRYSTAAT

UNIVERSITY OF THE FREE STATE

HOOFKAMPUS/MAIN CAMPUS

EECF62306

DEPARTEMENT EKONOMIE

DEPARTMENT OF ECONOMICS


ADDITIONAL YEAR-END EXAMINATION: NOVEMBER 2012

BYKOMENDE JAAREIND EKSAMEN: NOVEMBER 2012

ASSESSOR(E)/ 1. Mrs C.CampherASSESSOR(S): 2. Mnr. / Mr. S. Guvuriro

MODERATOR: Mr. N. Keyser

TYD/TIME: 2 uur/hours PUNTE/MARKS: 100

INSTRUCTIONS

• This paper consists of 6 questions on 7 pages.

• Answer all the questions.

• Read questions carefully and please write legibly.

• Show all calculations where necessary and all calculations should be rounded off to 2

decimal places.

QUESTION 1 20x2 Marks

Answer Question 1 in your answer book. Write the letter of your choice next to the

question number (e.g. 1.1 A or 1.1 B).

1.1 According to the classical economists, which of the following would make prolonged

unemployment impossible? A. flexible prices, wages, and interest rates. B. activist government policies.C. stable investment demand.D. a steadily growing money supply.

1.2 A movement along the consumption function is caused by a change in:A. consumption.B. expectations.C. aggregate supply.D. disposable income.


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1.3 When interest rates rise, the quantity demanded of money held for the:

A. speculative motive rises.

B. precautionary motive rises.

C. transactions motive remain unchanged.

D. speculative motive remain unchanged.

1.4 If a market basket of goods cost R150 in the base year and R450 in a year later, then theprice index for the latter year would be

E. 150F. 3G. 300H. 450

1.5 Assume a simplified banking system in which all banks are subject to a uniform reserve

requirement of 20 percent and checkable deposits are the only form of money. A bankthat received a new checkable deposit of R10 000 would be able to extend new loans upto a maximum of:

E. R50 000F. R12 000G. R10 000H. R8 000

Table 1: Disposable income and consumption data(in Rands)

Income (Y) Change in

Disposable Income Consumption (C) 0 500

1,000 1,000 1,4002,000 1,000 2,2003,000 1,000 2,9004,000 1,000 3,5005,000 1,000 4,000

Use the above table above to answer questions 1.6, 1.7 and 1.8

1.6 In Table 1, when disposable income (Y) is increased from R1 000 to R2 000, the marginal

propensity to consume is:A. 0.2.B. 0.6.C. 0.8. D. 1.0.

1.7. In Table 1, when disposable income is increased from R2,000 to R3,000 to R4,000,A. the marginal propensity to consume decreases from 0.7 to 0.6.B. the marginal propensity to consume remains constant.C. the marginal propensity to consume increases from 0.6 to 0.7.D. the marginal propensity to consume decreases from 0.8 to 0.7.


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1.8. In Table 1, when disposable income (Y) is increased from R0 to R1,000 to R2,000, themarginal propensity to consume:

A. is 1.B. decreases from 0.9 to 0.8.

C. decreases from 0.8 to 0.7.D. increases from 0.8 to 0.9.

Use the information below to answer Question 1.9 and 1.10

The unemployment rate in the Free State province is 9%, which economists estimate to be thenatural rate of unemployment. The inflation rate for the previous year was 3%. The Free Stateprovince’s policy makers believe they can reduce unemployment to a permanently lower rateby continually stimulating aggregate demand.

1.9. If the Free State government adopts this policy, what are the most likely short run effects on inflation and unemployment?

Unemployment rate Inflation rate A. Less than 9% Less than 3%B. Less than 9% more than 3%C. Remains at 9% less than 3%D. Remains at 9% more than 3%

1.10. If Free State adopts the policy what are the most likely long run effects on inflation andunemployment

Unemployment rate Inflation A. Less than 9% Less than 3%B. Less than 9% More than 3%C. Remains 9% Less than 3%D. Remains at 9% More than 3%

1.11. Only three goods are produced in an economy in the following amounts: A = 10, B = 30and C = 5. The current year per unit prices of these three goods are: A = R2, B = R3,and C = R1. Referring to this information, we can say that real GDP in the current yearis:

E. R45F. R115G. R270

H.

undefined.

1.12. The economy is operating at full employment, it is most likely that:A. unemployment is zeroB. structural unemployment equals frictional unemploymentC. the cyclical unemployment is less than frictional unemploymentD. structural unemployment and cyclical unemployment are equal to zero

1.13.South Africa’s supply curve of Rands is upward-sloping because a:A. higher number of yen per Rand means Japanese goods are cheaper in Japan.B. higher number of yen per Rand means Japanese goods are cheaper in South Africa.

C. lower number of yen per Rand means Japanese goods are cheaper in South Africa.


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D. none of these.

1.14.An increase in government spending will have the greatest expansionary impact on theeconomy if it is combined with:

A. an increase in tax revenue equal to the increase in spending.

B. a decrease in tax revenue equal to the increase in spending. C. unchanged tax revenue.D. none of these is true.

1.15 M2 money includes all but which one of the following?A. checkable deposits.B. savings accounts.C. large denomination time deposits. D. money market deposit accounts.

1.16. Potential real GDP is least likely to increase as a result of a(n)

A. improvement in technologyB. decrease in the income tax rateC. increase in the money wage rateD. increase in the quantity of capital

1.17. The economy’s potential rate of output is best represented byA. long run Aggregate SupplyB. short run Aggregate supplyC. long run Aggregate DemandD. short run Aggregate Demand

1.18. The phases of business cycle are:A. inflation and deflationB. upswing and recession.C. expansionary and contractionaryD. employment and unemployment

1.19 A South African citizen's gift for famine relief in Somalia would be considered a:A. capital inflow.B. capital outflow.C. current account transaction.

D. financial transaction.

1.20. Which of the following statements regarding the economic effects of taxes is most likely correct?

A. An increase in income taxes is an incentive to work more hoursB. A decrease in VAT reduces the supply of labour and potential GDPC. Decreasing the income tax rate increases the long term growth rate of the economyD. Taxing consumption instead of income would eliminate the negative effect of taxes on

economic growth.


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QUESTION 2 11 Marks

2.1 The table below gives information regarding Nominal GDP, CPI, Real GDP, Per capita

income and population of the economy of Utopia.2.1.1 Calculate the missing values in the table and provide the corresponding answer to theletter, for example, Z- R100.23 million (5)

Year Nominal GDP(millions ZAR)

CPI Real GDP ( inmillions ZAR) atconstant prices(2007)

Per capitaincome

Populationin millions

2006 428 61 J R15 946.35 0.044

2007 578 K 578.00 R12 297.87 L2008 M 112 625.89 N 0.052

2.1.2 With regard to the period under consideration are Utopians better off or worse off? Hint: refer to per capita income (1)

2.2 Identify the type(s) of unemployment explained in the scenarios below:2.2.1 The use of Blackboard at the University of Free State has left multiple choice markers

with nothing to mark. (1)2.2.2 The Euro Zone financial crisis has seen more Greek workers out of jobs. (1)

2.3 Draw a Lorenz curve that indicates a hypothetical situation where 20% of the worldpopulation receives 80% of the income generated in the world. (3)

QUESTION 3 13 Marks

3.1 Chad Le Clos deposited R3000 with FNB. The deposit increased money supply, throughFNB credit Creation to R60 000. 3.1.1 Calculate the value of the credit multiplier (1) 3.1.2 What is the value of the required reserve ratio? (2)

3.2 Indicate the motive for holding money in the following three cases3.2.1 Student keeps money in her current account in order to buy the economics book when it

will be delivered at the book shop. (1)3.2.2 The Euro Zone crisis has started to affect the JSE, stock prices are falling and investors

are shunning the market. (1)3.2.3 Workers with no medical policies keep more money in their bank accounts in case they

get sick any time. (1)

3.3 Assume the South African Reserve Bank decides to sell government bonds to the privatesector.3.3.1 Is this a monetary policy or fiscal policy action? Further indicate if it is an expansionaryor contractionary policy. (2)3.3.2 Make use of the AD/AS model to illustrate the impact that the sale of government

bonds would have on equilibrium price level and level of income. (4)


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3.3.3 Indicate whether the SARB should implement such a policy action when the inflationrate target is above the 3-6% target or below the 3-6% target. (1)

QUESTION 4 14 Marks

4.1 The table below shows a summary of the transactions that took place between theindividuals, firms and government units of country XYZ and those of all other nations duringthe year 2006.

Item Rand (billion)

Merchandise exportsMerchandise importsService receiptsNet direct investmentNet portfolio investment

Other investmentsPayments for servicesUnrecorded transactions

33030010032.468

35913421

4.1.1 Calculate the balance on the current account. (2)4.1.2 Calculate the change in gold and other foreign reserves. (2)4.1.3 How much would the trade balance be if the country’s imports were to increase byR125bn? (2)

4.2 Consider the rand/yen exchange rate, and focus on the market for yen. Using the demandand supply curves, explain whether the yen would appreciate or depreciate against the rand,

and whether that rand would appreciate or depreciate against the yen if the following thingshappened:4.4.1 Chase Beijing, a major Chinese bank, buys Standard Bank. (4)4.4.2 Due to the imposition of an import quota on Chinese clothing, South Africa importsmuch less from the China. (4)

QUESTION 5 10 Marks

5.1 The Euro Zone Policy makers suggest that troubled countries in the Euro Zone shouldcarry out austerity measures, which include reducing Government expenditure. Make use of acomplete Keynesian Transmission Mechanism economic chain reaction as well as suitablegraphs to illustrate and explain the effect of this action on the real and monetary sectors of theeconomy. (10)

QUESTION 6 12 Marks

6.1 Assume:TE = Total Expenditure, Y = Real GDP, C = consumption, I = Investment, G =Governmentexpenditure, X = Exports, M = Imports,If C = C0 + cY, T = Ta + tY where t is the marginal tax rate and Ta is autonomous tax.

And M = mY where m is the marginal propensity to import.


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6.1.1 In algebraic terms, write down consumption function after imposing tax. Indicate thevalue of the mpc and mps after tax. (3)6.1.2 Write down the Total Expenditure function, and calculate the equilibrium level ofincome in algebraic terms. (4)

6.1.3 If the marginal propensity to consume (c)=0.6, the marginal tax rate (t)=0.2, andmarginal propensity to import (m)=0.25. What is the value of the multiplier? (2)6.1.4 Considering the expenditure Multiplier formula in 6.3, name three instances that resultin a larger expenditure multiplier. (3)

The end


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EECF62306




ADDITIONAL YEAR-END EXAMINATION: NOVEMBER 2012

BYKOMENDE JAAREINDEKSAMEN: NOVEMBER 2012

ASSESSOR(E): Mrs/ Mev. C. CampherASSESSOR(S): Mr/ Mnr . S. Guvuriro



INSTRUKSIES:

• Hierdie vraestel bestaan uit 6 vrae op 7 bladsye.

• Beantwoord al die vrae.

• Lees elke vraag noukeurig en skryf netjies.

• Vir vrae 2 tot 5, dui alle nodige berekeninge en merk alle grafieke duidelik.

VRAAG 1 (2 x 20 =

40)Beantwoord Vraag 1 in u antwoordboek. Skryf die letter van u keuse langs die betrokke

vraagnommer neer (bv. 1.1 A of 1.1 B).

1.1 Volgens die klassieke ekonome, watter van die volgende sou langdurige werkloosheidonmoontlik maak?A. veranderbare pryse, lone en rentekoerse.B. aktivistiese regeringsbeleid.C. stabiele vraag na beleggings.D. 'n steeds groeiende geldvoorraad.

1.2 'n Beweging langs die verbruikersbestedings funksie word veroorsaak deur 'n veranderingin:A. verbruikersbestediging.B. verwagtinge.C. totale aanbod.D. Besteebare inkomste.

1.3 Wanneer rentekoerse styg, sal die hoeveelheid geld gevra vir die:A. spekulasiemotief styg.B. voorsorgmotief styg.C. transaksiemotief onveranderd bly.D. spekulasiemotief onveranderd bly.


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1.4 Indien 'n mark mandjie van goedere R150 in die basisjaar kos en R450 kos 'n jaar later,dan sal die prysindeks vir die laaste jaar wees:

E. 150F. 3

G.

300H. 450

1.5 Veronderstel 'n vereenvoudigde bankstelsel waarin al die banke onderworpe is aan 'neenvormige reserwevereiste van 20 persent en kontroleerbare deposito's is die enigstevorm van geld. 'n Bank wat 'n nuwe kontroleerbare deposito van R10 000 ontvang sal instaat wees om nuwe lenings te kan skep tot 'n maksimum van:

E. R50 000F. R12 000G. R10 000H. R8 000

Tabel 1: Besteebare inkomste en verbruikersbesteding data (in Rande)

Inkomste (Y) Verandering in

Besteebare

Inkomste

Verbruikersbesteding

(C)

0 5001,000 1,000 1,4002,000 1,000 2,2003,000 1,000 2,9004,000 1,000 3,5005,000 1,000 4,000

1

Maak gebruik van die tabel hierbo om vrae 1.6, 1.7 en 1.8 te beantwoord.

1.6 In Tabel 1, wanneer besteebare inkomste (Y) styg van R1 000 tot R2 000, is diemarginale geneigdheid om te verbruik:A. 0.2B. 0.6C. 0.8D. 1.0

1.7 In Tabel 1, wanneer besteebare inkomste (Y) styg van R2 000 tot R3 000 tot R4 000,A. daal die marginale geneigheid om te verbruik van 0.7 tot 0.6

B. bly die marginale geneigheid om te verbuik konstant.C. styg die marginale geneigheid om te verbruik van 0.6 tot 0.7.D. daal die marginale geneigheid om te verbruik van 0.8 tot 0.7.

1.8 In Tabel 1, wanneer besteebare inkomste (Y) styg van R0 tot R1 000 tot R2 000, sal diemarginale geneigheid om te verbruik:A. gelyk wees aan 1.B. daal van 0.9 tot 0.8.C. daal van 0.8 tot 0.7.D. toeneem van 0.8 tot 0.9.


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Maak gebruik van die onderstaande inligting om vrae 1.9 en 1.10 te beantwoord. Die werkloosheidskoers in die Vrystaat-provinsie is 9%, wat ekonome skat as die natuurlikewerkloosheidskoers. Die inflasiekoers vir die vorige jaar was 3%. Die Vrystaat provinsie sebeleidmakers glo dat hulle die werkloosheid kan verminder tot 'n permanente laer koers deurvoortdurend totale vraag te stimuleer.

1.9 Indien die Vrystaatse regering hierdie beleid aanneem, wat is die mees waarskynlikekorttermyn uitwerking op inflasie en werkloosheid? Werkloosheidskoers Inflasiekoers

E. Minder as 9% Minder as 3%F. Minder as 9% Meer as 3%G. Bly by 9% Minder as 3%H. Bly by 9% Meer as 3%

1.10 Indien die Vrystaatse regering hierdie beleid aanneem, wat is die mees waarskynlikelangtermyn uitwerking op inflasie en werkloosheid?Werkloosheidskoers Inflasiekoers

A. Minder as 9% Minder as 3%B. Minder as 9% Meer as 3%C. Bly by 9% Minder as 3%D. Bly by 9% Meer as 3%

1.11 Slegs drie produkte word geproduseer in 'n ekonomie in die volgende hoeveelhede: A =10, B = 30 en C = 5. Die per eenheid pryse van hierdie drie produkte in die huidige jaaris: A = R2, B = R3, en C = R1. Met verwysing tot hierdie inligting, kan ons sê dat diereële BBP in die huidige jaar is:

E. R45F. R115G. R270H. ongedefineerd.

1.12 Die ekonomie staan op volle indiensname, die waarskynlikheid is dat:A. werkloosheid nul is.B. strukturele werkloosheid gelyk is aan wrywingswerkloosheid.C. die sikliese werkloosheid minder is as wrywingswerkloosheid.D. strukturele werkloosheid-en sikliese werkloosheid gelyk is aan nul.

1.13 Suid-Afrika se aanbodskurwe van Rande het ‘n opwaartse helling omdat:

A. ‘n hoër aantal yen per Rand beteken Japannese goedere is goedkoper in Japan.B. ‘n hoër aantal yen per Rand beteken Japannese goedere is goedkoper in Suid AfrikaC. ‘n kleiner aantal yen per Rand beteken Japannese goedere is goedkoper in SuidAfrikaD. nie een van hierdie nie.

1.14 ‘n Toename in owerheidsbesteding sal die grootste ekspansionistiese impak op dieekonomie hê indien dit gekombineer word met:

A. 'n toename in belastinginkomste gelyk aan die toename in besteding.B. 'n daling in belastinginkomste gelyk aan die toename in besteding.C. onveranderde belastingsinkomste.

D. nie een van hierdie is waar nie.


31/41


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32

VRAAG 2 11 Punte

2.1 Die onderstaande tabel gee inligting oor Nominale BBP, VPI, Reële BBP, Per kapita-inkomste en die bevolking van die ekonomie van Utopia. 2.1.1 Bereken die ontbrekende waardes in die tabel en verskaf die ooreenstemmende

antwoord vir elke letter, byvoorbeeld , Z- R100.23 miljoen.(5)

Jaar Nominale BBP(milj ZAR)

VPI Reële BBP ( in miljZAR) teenkonstante pryse(2007)

Per kapitainkomste

Bevolkingin milj

2006 428 61 J R15 946.35 0.044

2007 578 K 578.00 R12 297.87 L2008 M 112 625.89 N 0.052

2.2.2 Met betrekking tot die tydperk onder oorweging is Utopistene beter af of slegter af?Wenk: verwys na per kapita inkomste (1)

2.3 Identifiseer die tipe werkloosheid wat verduidelik word in die scenario hieronder: 2.2.1 Die gebruik van Blackboard by die Universiteit van die Vrystaat het meervoudige keuse

merkers gelos met niks om te merk nie. (1)2.2.2 Die Euro Zone finansiële krisis het veroorsaak dat baie meer Griekse werkers sonder

werk sit.(1)

2.3 Teken 'n Lorenz-kurwe wat dui op 'n hipotetiese situasie waar 20% van die wêreld sebevolking 80% van die inkomste verdien wat gegenereer word in die wêreld. (3)

VRAAG 3 13 Punte

3.1 Chad Le Clos het R3000 gedeponeer by FNB. Hierdie deposito het veroorsaak dat diegeldvoorraad verhoog, deur FNB kredietskepping tot R60 000.3.1.1 Bereken die waarde van die kredietvermenigvuldiger. (1)3.1.2 Wat is die waarde van die persentasie vereiste reserwes? (2)

3.2 Dui aan die motief vir die hou van geld in die volgende drie gevalle3.2.1 Student hou geld in haar lopende rekening om die ekonomie handboek te koop wanneer

dit by die boekwinkel afgelewer sal word.(1)

3.2.2 Die euro-sone krisis het begin om die JSE te beïnvloed, voorraadpryse begin daal enbeleggers vermy die mark. (1)

3.2.3 Werkers met geen mediese fondse hou meer geld in hul bankrekeninge in geval hullesiek word.

(1)


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3.3 Veronderstel die Suid Afrikaanse Reserwebank besluit om staatseffekte aan die privaatsektor te verkoop.

3.3.1 Is hierdie ‘n monetêre of fiskale beleidsopsie? Verder dui aan of dit ‘n inkrimpende ofekspansionistiese beleid is. (2)

3.3.2 Maak gebruik van die AD/AS model om te illustreer wat die impak van die verkoop van

staatseffekte op die prysvlak en die vlak van inkomste sal wees. (4)3.3.3 Dui aan of die SARB so 'n beleidsaksie moet implementeer wanneer die inflasiekoers

teiken bo die teiken van 3-6% is of onder die 3-6% teiken is. (1)

VRAAG 4 14 Punte

4.1 Die tabel hieronder toon 'n opsomming van die transaksies wat plaasgevind het tussenindividue, maatskappye en die regeringseenhede van die land XYZ en dié van al die andernasies gedurende die jaar 2006.

Item Rand (billion)

UitvoereInvoereDienste ontvangsteNetto direkte investeringNetto portefulje investeringAnder investeringBetalings vir diensteOnopgeskryfde/ onaangetekende transaksie

33030010032.468

35913421

4.1.1 Bereken die saldo op die lopende rekening. (2)4.1.2 Bereken die verandering in goud en ander buitelandse reserwes. (2)4.1.3 Hoeveel sal die handelsbalans wees indien die land se invoere toeneem met R125bn?

(2)4.2 Neem die rand /yen-wisselkoers in ag, en fokus op die mark vir yen. Deur gebruik temaak van die vraag-en aanbodkurwes, verduidelik of die yen sal appresieer of depresieer teendie rand, en of die rand sou appresieer of depresieer teenoor die yen as die volgende dingegebeur:4.2.1 Chase Beijing, ‘n groot Chinese bank koop Standard Bank (4)4.2.2 As gevolg van die instelling van ‘n invoerkwota op Chinese klere, voer Suid Afrika baie

minder in van China. (4)

VRAAG 5 10 Punte

5.1 Maak gebruik van ‘n volledige Keynesiaanse Transmissie Meganisme kettingreaksie,sowel as al die nodige grafieke, om die impak van hierdie aksie op die reële en monetêresektore van die ekonomie te verduidelik en te illustreer.

(10)


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VRAAG 6 12 Punte

6.1 VeronderstelTE = Totale besteding, Y = Reële BBP, C = verbruikersbesteding, I = Investering, G =Regeringsbesteding, X = Uitvoere, M = Invoere

Indien C = C0 + cY, T = Ta + tY waar t die marginale belastingkoers is en T a is outonome belasting.En M = mY waar m die marginale geneigheid om in te voer is.

6.1.1 In algebraïese terme, skryf neer die verbruikersfunksie nadat belasting ingestel word.Toon duidelik die waarde van die mpc en mps na belasting aan.

(3)6.1.2 Skryf neer die Totale Bestedingsfunksie en bereken die ewewigsvlak van inkomste. (4)6.1.3 Indien die mpc (c)=0.6, die marginale belastingkoers (t)= 0.2 en die mpm (m)=0.25.

Wat is die waarde van die vermenigvuldiger?(2)

6.1.4 Veronderstel die vermenigvuldiger formula in 6.1.3, noem drie gevalle wat sal lei tot ‘ngrooter bestedegingsvermenigvuldiger. (3)


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35



EECF62306




MAIN YEAR-END EXAMINATION: 28 NOVEMBER 2012

HOOFJAAREINDEKSAMEN: 28 NOVEMBER 2012

MEMORANDUM


QUESTION 1 (2 x 20 = 40)

1.1 A

1.2 D

1.3 C

1.4 C

1.5 D

1.6 C

1.7 A

1.8 B

1.9 D

1.10 D

1.11 B

1.12 AJBJCJD

1.13 B

1.14 B

1.15 C

1.16

C

1.17 A

1.18 B

1.19 C

1.20 C


36/41

36

QUESTION 2 (11)

2.1

2.1.1 %&'1* i))io'

+& 100

L& 0.047 i))io'

M& 701.0 i))io'

,& 12 036.40

2.1.2 Kore o!!

2.2

2.2.1 Str%ct%ra) %'e(p)o*(e't

2.2.2 C*c)ica) &'e(p)o*(e't

2.2.3 Correct ai )a$e)i'g

C%

(%

)ati

e

wo

r)+

*

20

100

0

80 100

C%(%)atie wor)+ pop%)atio'


37/41

37

QUESTION 3 (13)

3.1

3.1.1 Cre+it (%)tip)ier" 600003000" 20

3.1.2 eL%ire+ reere" 120 Va)%e eL%ire+ eere "120 < 3000" 150 OR

eL%ire+ eere " 5

3.2

3.2.1 ?ra'actio'ar*

3.2.2 Spec%)atie

3.2.3 Preca%tio'ar*

3.3

3.3.1 o'etar* po)ic* co'tractio'ar* po)ic*

3.3.2 Correct )a$e))i'g

3.3.3 Po)ic* actio' o%)+ $e i(p)e(e'te+ we' te i'!)atio' rate target i above t$e 3&-

tar"et

Aerage priceCPI

P0

P1

Y1 Y0

ea) @DP

AS

AD0

AD1


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38

QUESTION 4 (20)

4.1

4.1.1 C%rre't acco%'t 330 , 100 300 134 " 4 $i))io'

4.1.2 :i'a'cia) acco%'t 32.4 , 68 , 359 " 459.4 $i))io'Ba)a'ce o' BMP 4 , 459 , 21 " 476.4 $i))io'

Ca'ge i' reere " ,476.4 $i))io'

4.1.3 ?ra+e $a)a'ce " 330 , 100 , 425 134 " 130 $i))io'

4.2.1

?e Ye' wi)) +epreciate a'+ te a'+ wi)) appreciate

4.2.2

?e *e' wi)) +epreciate a'+ te ra'+ wi)) appreciate

S1 o! *e'

S o! *e'

D !or *e'

per *e'

G o! *e'

G o! *e'

per *e'

S o! *e'

D !or *e'

D1 !or *e'


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39

(Minus 1 for incorrect labels and axes)

QUESTION 5 (10)

Economic .ariable: @oer'(e't epe'+it%reSpe'+i'g

ea) ector @ ?- P Y@DP

o'etar* ector + i

?-0

?-1

@DP

?-

Y1 Y0

Y"A-"?-

AD0AD1

AS

+0

+1

r1

r2

@+pY1 Y0

P0

P1


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40

QUESTION 6 (12)

6.1

6.1.1 C"C0, cY+ were Y+"Y? C" C0 , cY?atY/

C"C0c?a,c1t/Y

M#c/c(1&t) after tax

S"C0,Y?a,tY/

S"C0?a,1t/Y

M#s/s(1&t) after tax

6.1.2 ?-"C,I,@,


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Documents

Exam 2012 with memo.pdf