Other Economics Answers

•       distinguish between a flow and a stock

•       identify the two basic sets of markets in the economy

•       identify the various economic participants/list

•       the components of total spending

•       identify the various injections into and

•       leakages from the circular flow of income and spending

Name the three possible leakages out of the circular flow of income and spending in an economy.

Define the following concepts: 5.1. Flow variable 5.2. Stock variable 5.3. Household 5.4. Firm 5.5. Transfer payments 5.6. Balance of payments

An increase of exports from South Africa to other countries will … . [1] increase the income of South African producers and increase aggregate spending on South African goods [2] increase the income of South African producers and decrease aggregate spending on South African goods [3] decrease the income of South African producers and decrease the aggregate spending on South African goods [4] decrease the income of South African producers and increase the aggregate spending on South African goods

The act of purchasing capital goods is called … . [1] consuming [2] making a profit [3] capital formation [4] producing

The flow of income and spending is usually a … . [1] monetary flow and flows in the same direction as goods and services [2] goods flow and flows in the same direction as goods and services [3] services flow and flows in the opposite direction to goods [4] monetary flow and flows in the opposite direction to goods and services

Calculate the public interest scores in order to consider whether the following companies should be audited or not:

XYZ (Pty) Ltd (XYZ). Mr. X owns 50% of the shares in XYZ. Due to Mr. X’s excellent financial background, he handles all the financial matters of XYZ, including the compilation of the financial statements. The company employs a workforce of 70 employees on average. The company had a turnover of R80 million and owes no third party liabilities. Mr. Y (10%) and Mr. Z (40%) hold the remaining shares

suppose you are a monopolist and find that the demand elasticity of your product is different in two market what would be your pricing strategy

23. If Total Poverty Gap is $5,000, the number of persons whose income fall below the poverty line is 200, and the size of population is 1,000, then what is the Average Poverty Gap? 

 (a) $5       (b) $250      (c) $1 million     (d) $10 

24. Which of the following is included into the computation of both Gender Development Index(GDI) and Gender Inequality Index(GII)? 

(a) women’s educational attainment   (b) women’s life expectancy at birth

 (c) women’s participation in the workforce (d) women’s income per person  

25. Which of the following can have a value bigger than 1? 

(a) Gender Inequality Index         (b) MPI

(c) Gini coefficient             (d) Normalized Poverty Gap

(e) Gender Development Index

Choose the best answer to each question.

21. Estimated Gini coefficients from actual international data typically lie between (  A ) for countries of highly unequal income distributions, and for countries with relatively equal distributions, they lie between (  B  ).

(a) A= 0.50-0.70, B = 0.20-0.35    (b) A= 0.80-1.00, B = 0.50-0.70

(c) A= 0.20-0.35, B = 0.35-0.50    (d) A= 0.40-0.60, B = 0.60-0.80

22. Which of the following is false regarding measures of income distribution? 

(a) Factor share distribution of income offers no information about how income is distributed among individuals.

(b) Measures of size distribution of income, such as the Gini coefficient, is not affected by the size of population.

(c) If Gini coefficient is 0.3, income distribution is considered highly unequal.    

(d) For developing countries, income growth based on Ahluwalla-Chenery 

 welfare index will be generally lower than GNI growth rate.