Economics Unit 2 Paper 2 June 2014 Cape Exam N.L. 1) a) Intermediate goods- goods and services purchased for resale or further processing or manufacturing. b) I) GDP only includes the market value of final goods‚ not intermediate goods because the value of final goods already includes the value of all intermediate goods used in producing them. (Including the value of intermediate goods would amount to multiple counting‚ and that would distort the value of GDP) II)
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its best‚ but it has not lessen‚ not as a result of income having increased‚ but as a result of consumers are now in more debt‚ generally by refinancing against rising housing prices. This is a perfect example of the definition of the marginal propensity to consume (MPC)‚ which is affected by consumer confidence and interest rates as they affect the rate of return on
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elastic‚ higher d. inelastic‚ lower e. inelastic‚ higher ANS: E 供需彈性 4. The fact that the fourth plate from the “All You Can Eat Country Buffet” generated more satisfaction than the fifth plate is an example of a. increasing marginal utility. b. diminishing marginal utility. c. diminishing total utility. d. the “paradox of value.” e. none of the above ANS: B 消費者選擇 5. When the wage rate increases from $5.00 to $7.50 per hour‚ Bob works more hours because a. his income effect outweighs
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| |increase in the: (a) level of government spending on national defense. (b) sale of U.S. | | |Treasury bonds by the Federal Reserve System. (c) marginal tax rates on corporate and personal | | |incomes. (d) reserves that banks are required to hold as percentages of their deposits. |
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of different matrix. The total consumer spending in an economy is generally calculated using the consumption function‚ a matrix devised by John Maynard Keynes‚ which simply takes the aggregate disposable income and multiplies it by a "marginal propensity to consume". This matrix essentially defines consumption as the part of disposable income that does not go into savings. But disposable income in turn can be defined in a number of ways - e.g. to include borrowed funds or expenditures from savings
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down‚ CS increase due to 2 reasons. Existing buyers pay less. More buyers are able to enter market. Producer surplus Markets select low cost suppliers. Only those whose costs of production are below the market price enter. When price goes down‚ ‘marginal seller’ drops out. When
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known as “cash on hand‚” or the sum of current income and spendable assets) to his or her level of spending. Perhaps the most important feature of the figure‚ for both microeconomic and macroeconomic analysis‚ is what it says about the marginal propensity to consume(MPC)—that is‚ how much extra spending will result from a given increase in cash on hand. When levels of cash on hand are low‚ the MPC is very high‚ indicating that poor households are likely to spend any windfall income rather quickly
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Form 6 Economics Unit 2 1 ½ Hours Answer ALL questions 1. Which one of the following constitutes a leakage from the circular flow of income? a. The purchase of a domestically produced good by a domestic company b. The purchase of a domestically produced good by a foreign company c. The payment of value added tax on goods sold to the domestic market d. Government aid to companies in financial difficulties 2. Which of the following is not a reason for a country collecting national income
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preferences are imagined to be high; production for the market does not take place and producers apparently do not follow profit-maximizing rules: ‘disguised’ or open unemployment is supposed to prevail throughout the rural sector and indeed the marginal productivity of labour is expected to be zero‚ and in some cases negative (Nurkse 1953). Income is equal to subsistence level (Leibenstein 1957:154) partly determined by physiological and partly by cultural levels (Lewis 1954). Further‚ capital has
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THE INDIAN HIGH SCHOOL DUBAI YEAR 2013-14 Page 1 COMPILED BY HOD ECONOMICS MRS. CHANDRA R INDEX S NO 1 TOPIC PAGE NO 3 - 20 INTRODUCTION TO MACRO ECONOMICS 21 – 35 2 AGGREGATE DEMAND AND AGGREGATE SUPPLY 3 36 - 43 MONEY AND BANKING 4 44 - 49 GOVERNMENT BUDGET 5 49 - 58 BALANCE OF PAYMENT AND FOREIGN EXCHANGE 6 59- 66 BOARD PAPER 2013 DELHI 7 67 - 75 MARKING SCHEME Page 2 COMPILED BY HOD ECONOMICS MRS. CHANDRA R HANDBOOK
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