Which of the following may result from inflation in the domestic economy? Select one: a. Positive impact on BOP b. Increasing Incomes c. Cheaper Imports d. Cheaper Exports e. Falling prices
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Which of the following may result from inflation in the domestic economy?
Select one:
a. Positive impact on BOP
b. Increasing Incomes
c. Cheaper Imports
d. Cheaper Exports
e. Falling prices
Step by step
Solved in 3 steps
- Rising inflation is a biggest challenge for every economy. A sustainable economic growth need price stability which makes essential approach for consumption demand. Higher fluctuation in inflation rate is causing insufficient productivity in economy and consumption demand. Effective utilization of expansionary and contractionary economic policy make may make balance between economic growth, price stability, aggregate demand & supply and employment level. The main components of the consumer price index in Oman are Food, Beverages, Tobacco Transport, Communication, Rent, Electricity, Water and Fuel. Consumer prices in Oman rose by 1.59 percent year-on-year in April of 2021; it was the first monthly increase in consumer prices since March of 2020. The consumer prices in Oman decreased by 1.57 percent year-on-year in January of 2021, marking the eleventh consecutive month of declining in consumer price index which leads to economic slowdown. Major consumption expenditure in 2017 was…Activity • Discuss which policies can be implemented in the following situations along with the justifications. • To control the inflation rate • To reduce the income distribution disparities • To increase the investments in construction sector • To encourage the individuals to spend more on consumption • To enhance the government revenue To control imports To reduce unemploymentWhich of the following will NOT cause inflation to increase in home country? An increase in the aggregate demand An increase in the cost of production An increase in the unemployment rate An increase in the prices of imported goods
- Suppose you are the governor of Country A and you have observed some changes in your country. Identify the likely impact on Country A with the economic concepts we have discussed in this course. i. Establishment of more labour unions in many industries in the country ii. A widespread of global pandemiciii. An abolishment of minimum wage lawiv. Much more educated workers than a decade before How would the unemployment rate be affected in each of the above cases? Identify the specific type of unemployment (frictional, structural or cyclical unemployment) affected in each case. i. An earthquake destroying many factories and roads in the country ii. A removal of restrictions on foreign workers working in the country iii. Reaching a trade agreement with many other countriesiv. An occurrence of hyperinflation in the country How would the long run economic growth of the country be affected in each of the above cases? Briefly explain your answers.Government spending increases• Workers expect high future inflation and negotiate higher prices now• Technological improvement increase productivityIdentity several parties likely to he helped and hurt by inflation.
- Retrieve inflation data from The World Bank data base (http://databank.worldbank.org/data/home.aspx) for India, Spain, and South Africa for 20112015. Prepare a chart that compares India, Spain, and South Africa based on the data. Describe the key differences between the countries. Rank these countries as high-, medium-, and low-income. Explain what is surprising or expected about the data.Is inflation likely to be a problem for at least some low- and middle-income economies in the near future?Consider the following data for a particular country. Real GDP per Capita, Year 1 Population, Year 1 and Year 2 $37,500 400 million Inflation Rate 4 percent Instructions: In part a, enter your answer as a whole number. In part b, round your answer to 2 decimal places. a. What is real GDP per capita in year 2? Growth Rate of Real GDP, Year 1 to Year 2 6 percent b. What is real GDP in year 2? trillion
- If a country experienced nominal GDP growth of 8% over the two period when it faces inflation of 5%, what is the real GDP growth of this country? (provide exact answer in two decimal points) Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.What is the core inflation in the Philippines?Inflation and international tradeIdentify which statements are true and which ones are false. For all statements, briefly explain why they are true or false. a) Economists projected inflation rate to be 4% in 2022 in country X. In reality, inflation rate was 7%. Borrowers in country X are better off.b) The government in country X decided to print more money and give transfers of $1,000 to citizens who recently retired. It will cause a decrease in money supply, so the value of money will increase, and prices will decrease.c) Countries X and Y are neighbors. When the government in country X decides to print more money, the value of currency of country Y increases, so this currency appreciates, while the currency of country X depreciates.d) Budget surplus in country X causes a shift of the supply curve for loanable funds to the left, so the real interest rate increases. Then, the net capital outflow decreases, and hence the real exchange rate decreases
