(a) What do you understand by the terms recession, trough, and recovery? How does the change in the unemployment rate relate to business cycle? (b) What is the difference between real GDP and nominal GDP? Discuss factors that affect the income level of a country.
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QUESTION 3
(a) What do you understand by the terms recession, trough, and recovery? How does the change in the
(b) What is the difference between real GDP and nominal GDP? Discuss factors that affect the income level of a country.
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- Question 4 (a) Assume that you are an economic advisor to our Prime Minister. The prime ministers ask you to design a program to reduce the amount of unemployment in Malaysia. What major elements would you include in your plan? Justify your answer, (b) Study the given table and answer the following questions. Year Labor force Employment (thousand) 6350 6850 7042 (thousand) 5790 2017 2018 6290 2019 6686 2020 7241 6926 2021 7441 7148 (a) Calculate the unemployment rate for years 2017 to 2021. (b) What is the percentage of growth in the number of labor force between the year 2017 and 2021?Use the following to answer questions 1-6: Working Age Population Labor Force # of Employed 1. What is the number of unemployed in year 1 in Table 6.1? (A) 60 million. (B) 5 million. 3. What is the unemployment (A) 57.1 percent. Population and labor force data Year 1 140 million 80 million 65 million 2. What is the number of unemployed in year 10 in Table 6.1? (A) 17 million. (B) 78 million. 4. What is the unemployment (A) 86.3 percent. (C) 15 million. (C) 13 million. (B) A positive relationship. (C) No relationship. (D) A negative relationship. rate in year 1 in Table 6.1? (B) 46.4 percent. (C) 18.75 percent. rate in year 10 in Table 6.1? (B) 13.7 percent. (C) 51.3 percent. 5. What is the labor-force participation rate in year 1 in Table 6.1? (A) 9.3 percent. (B) 81.3 percent. (C) 46.4 percent. 6. What is the labor-force participation rate in year 10 in Table 6.1? (A) 59.4 percent. (B) 8.1 percent. (C) 86.3 percent. Year 10 160 million 95 million 82 million (D) 75 million. (D) 65…GDP and inflation: Consider an economy that produces and consumes haircuts and cars. The next table contains data on two different years Price of a car Price of a hair cut 2000 $50,000 $10 2020 $60,000 $20 120 Number of cars 100 Number of haircuts 500,000 400,000 (a) Compute the following indicators for each year using 2000 as your base year: nominal GDP, real GDP and the GDP deflator. (b) How much did prices go up between 2000 and 2020? What has been the annual inflation rate?
- Using your knowledge of price indexes, answer the following questions. (a) In a base year, what will the value of a price index always be? (b) If producers face rising costs of production, which price index will rise first? (c) Which price index captures changes in the largest variety of goods and services?(b) Using the following data calculate:(i) The number of persons employed. (ii) The number of persons unemployed. (iii) The labour force. (iv) The Labour Force Participation rate. (v) The “official” unemployment rate. 987,156 Currently Working 23,000 volunteer workers9845 (ages 13-14) looking for work 12,000 (ages 15) looking forwork45,600 Part-Time workers 56 family workers who worked15 hrs a week234 Self-Employed 6543 Discouraged Workers67,432 (ages 23-25) looking for work 67,890 laid off receptionistslooking for work544,321 (ages 16-20) looking for work Current population is6,000,0005654 Temp Workers 5000 armed forces543 recent university graduates thatare going back to graduate school3500 institutionalized1. You are given the following information for a country: Participation rate = 75%, Unemployment rate = 10%, Employment rate = 67.5% and Number of employed = 27 million. Based on this information, calculate the following (in millions): (a) Working age population (b) Size of the labour force. (c) Number of unemployed people
- (a) The following table shows the outputs and prices of three products produced by an economy in 2018, 2019 and 2020. (i) Measure the nominal GDP, the real GDP and the GDP deflator in 2019 and 2020, taking 2018 as the base year.(ii) Using the GDP deflator, measure the inflation rate in the economy between 2018 and 2019, and also between 2019 and 2020. (b) Assume all household consumption items are locally produced as shown in the table in Question (a). A typical household in the economy consumes 5 units of rice, 4 units of shirt and 2 units of shoes in 2018. Using 2018 as the base year, measure the CPI for 2019 and 2020 and the inflation rate between 2018 and 2019, and also between 2019 and 2020. Explain why the inflation rate is different from those computed from (a)(ii).Question 2 (i) Explain the difference between Gross Domestic Product (GDP) and Gross National Income. (ii) Explain the difference between Gross Domestic Product at factor cost (basic prices) and Gross Domestic Product at market prices. (iii)Explain the difference between nominal Gross Domestic Product and real Gross Domestic Product over time and the role of the GDP deflator.Year 2010 2011 2012 2013 2014 2015 Economic growth (%) 2.7 1.7 1.3 2.7 2.5 1.9 Unemployment (%) 9.6 8.9 8.1 7.4 6.2 5.3 Examine the data on the economic growth and unemployment rate for 2010-2015 a. What trends do you observe in the unemployment rate? In economic growth? b. Identify the relationship between Economic Growth and Unemployment, if any. (positive, negative, no relationship) Use the data to justify your choice. c. Does the relationship observed in part 2 satisfy the economists' view of the relationship between economic growth and unemployment? Use references to support your answer.
- QUESTION 1(a)The table above shows the output of goods and services in a simple economy over a three- year period i. Calculate nominal Gross Domestic Product (GDP) in 2009, 2010, and 2011 ii. Using 2009 as your base year, calculate real GDP in 2009, 2010, and 2011. iii. Calculate the GDP deflator for 2009, 2010, and 2011.During an economic expansion, real GDP ____ and unemployment ____.(a)increases, increases(b)increases, decreases(c)decreases, increases(d)decreases, decreasesPrepare a line graph from the table below and answer the following question. (i)What trends do you observe in the unemployment rate? In economic growth? (ii) Identify the relationship between Economic Growth and Unemployment, if any. (positive, negative, no relationship) Use the data to justify your choice. (iii) Does the relationship observed in part 2 satisfy the economists' view of the relationship between economic growth and unemployment? Use references to support your answer. 2016 2017 2018 2019 2020 Unemployment rate 4.12 3.75 3.38 3.14 4.31 Economic growth rate 2.23 2.68 1.08 1.05 -4.57