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A Level Economics:

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multiplier in four sector economy is
k = 1/pms+MPT+MPM = 1/0.0.5 + 0.25 + 0.2 = 1/0.5 = 2
20% = 0.2, 25% = 0.25 and 5% =0.05.
Hope you got it.
Thank you sir.I got it.I think you meant mps instead of pms.

Sir, here's another question I need help with.
In a closed economy with no government C = 30 + 0.8 Y and I = 50, where C is consumption, Y is
income and I is investment.
What is the equilibrium level of income?
A 64 B 80 C 250 D 400
Ans D
 
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And sir,in this one the answer is A.I dont understand how?

22 According to Keynesian theory, what would cause individuals to want to hold more idle money
balances?
A an increase in bond prices
B an increase in the rate of interest
C an increase in the rate of inflation
D an increase in the level of output
 
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Thank you sir.I got it.I think you meant mps instead of pms.

Sir, here's another question I need help with.
In a closed economy with no government C = 30 + 0.8 Y and I = 50, where C is consumption, Y is
income and I is investment.
What is the equilibrium level of income?
A 64 B 80 C 250 D 400
Ans D
Dear its very simple just put the values in formula;
Y = C + I. (Put the values of C and I)
Y = 30 + 0.8 Y + 50
Y - 0.8 Y = 80
0.2 Y = 80
Y = 80/0.2 = 400.

Hope you got it.
New books of AS and A2 economics by qamar baloch updated till June 2013 are now available in the market.
 
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And sir,in this one the answer is A.I dont understand how?

22 According to Keynesian theory, what would cause individuals to want to hold more idle money
balances?
A an increase in bond prices
B an increase in the rate of interest
C an increase in the rate of inflation
D an increase in the level of output

dear there are two types of holdings of money the one is called active balance which is kept by the people for transactive motives means to meet day to day expenses and the other is idle balance which is not held for daily spending rather it is held with a view to earn more interest/profit. when bonds prices are high people will prefer to keep more bonds which means holding of idle money is higher.
 
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dear there are two types of holdings of money the one is called active balance which is kept by the people for transactive motives means to meet day to day expenses and the other is idle balance which is not held for daily spending rather it is held with a view to earn more interest/profit. when bonds prices are high people will prefer to keep more bonds which means holding of idle money is higher.
Thank you sir.You're a life-saver.
 
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as salam o alikum sir, i have seen how u r helping us..thnx a lot
actually ill do my AS and A levels in june 2014...so i wanted notes..becoz i dont have a proper teacher in my school! i hope u can help me thnx a lot
 
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Hello sir, I have my eco p2 in a few days, i have read the cie eco textbook for abt 4 times, and solved abt 3 to 5 p2s, but i am not understanding what shld i do for the last min preparation, can u pls help me by guiding what shld i do at this point of time, and pls predict any particular ques or topic u think is probable to come this time! really appreciate ur help! thank u! God bless u! :)
 
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Sir, provide the guess paper to students but tell them not to rely just on guesses. They should ensure that full syllabus has been studied and past paper questions practiced, then they should go on guesses.
 
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Sir, provide the guess paper to students but tell them not to rely just on guesses. They should ensure that full syllabus has been studied and past paper questions practiced, then they should go on guesses.
Exactly. Guess paper works only for those who have the complete knowledge of CIE syllabus.
 
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