Economics, Accounting & Business: Post your doubts here!

[Heyyy]

Helloo!!
i just wanted to ask that the economics paper 3 that is our MCQ paper is on the 4 of june rite?
just confirming!!!!

Yes
AM paper

 

[asadalam]

A) devaluation of currency would mean imports becoming more expensive thus imported inflation(wrong choice)
C) same as A
D) the removal of import tariffs won't help lowering BOP deficit.

Q24.
Decrease in taxes and increase in investment will shift the demand curve to right.
A decrease in tariffs will increase imports by not much as still tariff remains.
Answer should be D

Q5
Apply all the options.The one which stands true will be the answer

In 24,shouldnt it be B,as net exports will still fall and cause reduction ,even if its a small amount.D would lead to people getting higher disposable income and hence increase AD.Dont you think?

And in 5 i calculated the percentage changes and initially sales increased faster than price change but by the end change had no effect on price like on both 12 and 10 the total revenue recieved and hence the sales were the same.

 

[Heyyy]

In 24,shouldnt it be B,as net exports will still fall and cause reduction ,even if its a small amount.D would lead to people getting higher disposable income and hence increase AD.Dont you think?

And in 5 i calculated the percentage changes and initially sales increased faster than price change but by the end change had no effect on price like on both 12 and 10 the total revenue recieved and hence the sales were the same.

Actually the decrease in tariffs will also have an effect on SRAS as imported raw material will be cheaper now.

I haven't tried Q5,can't find my calculator lol

 

[Uppadoo Krishna]

Can u plz explain me the concept of ''paradox of thrift"'.

 

[Heyyy]

Can u plz explain me the concept of ''paradox of thrift"'.

What I've read about it is that the Keynes say people will actually save less than what they plan to.This is the paradox of thrift

 

[ahamedshiffer]

Hi everyone, AsSalamoAlaikum Wr Wb...

To get things organized in a better way, I am making this thread. As othewise, some queries remain unanswered!

So post your AS/A2 Accounts, Business or Economics doubts in this thread. InshaAllah other members around will be there to help you.

NOTE: If any doubts in the pastpapers, please post the link!


Regards,
XPC Staff.

guyz a help

 

[yingtan]

How do I get the answer for no.8?
Thank you!

 

[Heyyy]

How do I get the answer for no.8?
Thank you!

Using the formula for XED.
Take the price of X and quantity of Y.

 

[asadalam]

Using the formula for XED.
Take the price of X and quantity of Y.

Price increase is 25% and on both occasions Q increase is 50%(20-30 and 16-24) That give XED of 2.So how do we get value of 1.66?

 

[Heyyy]

Price increase is 25% and on both occasions Q increase is 50%(20-30 and 16-24) That give XED of 2.So how do we get value of 1.66?

It's just a range.
We don't need to get 1.66
Just need to show that it falls in the range.

 

[asadalam]

It's just a range.
We don't need to get 1.66
Just need to show that it falls in the range.

But then it can also be B C D as 2 falls in their range as well

 

[Heyyy]

But then it can also be B C D as 2 falls in their range as well

I think sabse choti range chose karlo lol

 

[asadalam]

Heyyy

Wont decreasing interest rate lead to depreciation in currency and hence make exports cheaper,imports expensive,further causing surplus?

 

[Heyyy]

HeyyyView attachment 54069

Wont decreasing interest rate lead to depreciation in currency and hence make exports cheaper,imports expensive,further causing surplus?

A surplus will cause a rightward shift in demand curve of the currency because more exports.
By decreasing interest rates the demand will be lowered as people will prefer saving in countries with higher interest rates.
Supply will also increase causing the fixed exchange rate to retain

 

[asadalam]

Just a lil something.After you've done the paper and all the collection of answer sheets is going and and stuff,record your answers in your calculator.I have that silver casio one and on that you can save values using Shift,RCL after entering the values

Save ans like this 124123 will denote ABDABC .Save on multiple letters as one letter can not accumumlate more than 9 values.This will help us compare our answers as well as compare them to the ms when it comes out,especially for AS as it'll give an indication of how much marks you got.Might save someone money from rechecking.

Heyyy

 

[Heyyy]

T

Just a lil something.After you've done the paper and all the collection of answer sheets is going and and stuff,record your answers in your calculator.I have that silver casio one and on that you can save values using Shift,RCL after entering the values

Save ans like this 124123 will denote ABDABC .Save on multiple letters as one letter can not accumumlate more than 9 values.This will help us compare our answers as well as compare them to the ms when it comes out,especially for AS as it'll give an indication of how much marks you got.Might save someone money from rechecking.

Heyyy

thanks man!

 

[Heyyy]

How do I check the saved numbers?

 

[Asim Shah]

Price increase is 25% and on both occasions Q increase is 50%(20-30 and 16-24) That give XED of 2.So how do we get value of 1.66?

Now loo at the decrease in pric e

%Change in Qd = 4/12*100= 33
% change in price 2/10*100 = 20


So 33/20= 1.66

 

[fatburrito123]

In a closed economy with no government, the level of investment is $5 million, the equilibrium level of income is $22 million, the full employment level of income is $25 million and there is a deflationary gap of $1 million. What can be deduced from this information?
A The marginal propensity to consume is 2/3 .
B The marginal propensity to consume is 1/3 .
C The value of the investment multiplier is 5.
D The value of the investment multiplier is 1.5.

Can someone please explain why A is the answer? Thank you!

 

[Mahreen Mustafa]

In a closed economy with no government, the level of investment is $5 million, the equilibrium level of income is $22 million, the full employment level of income is $25 million and there is a deflationary gap of $1 million. What can be deduced from this information?
A The marginal propensity to consume is 2/3 .
B The marginal propensity to consume is 1/3 .
C The value of the investment multiplier is 5.
D The value of the investment multiplier is 1.5.

Can someone please explain why A is the answer? Thank you!

The difference between the full employment level of income and the equilibrium level of income is 3
Therefore, multiplier = 3/1 = 3
Now, multiplier = 1/(1-mpc)
mpc = 2/3