Economics, Accounting & Business: Post your doubts here!

[Mad Gal]

http://www.xtremepapers.com/papers/CIE/Cambridge International A and AS Level/Economics (9708)/9708_s04_qp_1.pdf
qns 28- aren't they asking the cause for appreciation! isn't C an after effect
qns 26-can anyone pls explain why D is not right and why B is right?
qns 1-=.= i didnt understand the qns itself?

Que 1 - the question mentions that the economy is currently fully employed, on the PPF. If it chooses to concentrate on the production of capital goods, what it has to sacrifice in the moment is consumption of the consumer goods. Did you get it??

Que 26 - B because, the economy is moving towards the full employment level. Opt D could've been right, if more information had been given?! What if the goods being imported are actually alot cheaper? Then it wouldn't really contribute to inflation. Yea?

Que 28 - its like this, when you import more, supply of Yen will deffa rise. In this case, JApan has reduced its spending on imports leading to lesser supply of Yen. Did u get it? :/

 

[shanky631]

can anyone help with this question in economics. would appreciate any help.

 

[Mad Gal]

Another question :S plz help
thnx in advance...

See, in the month of sale 20% is made in cash. So 20% of April's sale = 44000.
50% of sale will be paid the next month. So 50% of March will be paid in April. = 1350000
and 30% will be paid 2months after the month of sale. Which means that Feb sales of 30% will come to April. = 72000
SO total receipts in April = 251000.

 

[Mad Gal]

can anyone help with this question in economics. would appreciate any help.

View attachment 9498

is the ans B?

 

[shanky631]

is the ans B?

yes the answer is b. can u plz explain?

 

[Mad Gal]

yes the answer is b. can u plz explain?

In opt B US comp builds a factory, its an investment made in Mauri resulting with outflow of profits income and etc so it worsens the invisible bal..and it improves the visible balnce, coz it sets a factory to produce goods for the African market. So production takes place and is exported via Mauri. SO it improves their visible balance. Did u get it??

 

[shanky631]

In opt B US comp builds a factory, its an investment made in Mauri resulting with outflow of profits income and etc so it worsens the invisible bal..and it improves the visible balnce, coz it sets a factory to produce goods for the African market. So production takes place and is exported via Mauri. SO it improves their visible balance. Did u get it??

i do understant the worsening of invisible balance but how will visible balance improve if the goods are meant for the african market??

 

[parthrocks]

In opt B US comp builds a factory, its an investment made in Mauri resulting with outflow of profits income and etc so it worsens the invisible bal..and it improves the visible balnce, coz it sets a factory to produce goods for the African market. So production takes place and is exported via Mauri. SO it improves their visible balance. Did u get it??

Hey dude bt invisible balance is the same as trade services..........correct????

 

[Mohammed Hassan]

See, in the month of sale 20% is made in cash. So 20% of April's sale = 44000.
50% of sale will be paid the next month. So 50% of March will be paid in April. = 1350000
and 30% will be paid 2months after the month of sale. Which means that Feb sales of 30% will come to April. = 72000
SO total receipts in April = 251000.

Yup! understood thnnnnnnnx

 

[Mohammed Hassan]

Can someone plz explain how to calculate the value of the goods in number ( vii ) and what is meant by ( a sale or return basis ) and what to do with it?
plz help..
and thnx in advance

 

[shanky631]

Why is the answer c??????. someone plz explain.

 

[Mad Gal]

i do understant the worsening of invisible balance but how will visible balance improve if the goods are meant for the african market??

thats bcoz you're producing it in Mauritius and exporting it from Mauritius to Africa. So exports will be recorded in Mauritius' BOP. Got it? the company maybe US's buh that doesn't matter when concerned with visible balance.

 

[Mad Gal]

Hey dude bt invisible balance is the same as trade services..........correct????

Trade balance = difference between exports and imports of goods and services.
Visible balance = only goods
Invisible balance = services + Income + Transfers.

Correct me if am wrong anyone!!!???

 

[shanky631]

thats bcoz you're producing it in Mauritius and exporting it from Mauritius to Africa. So exports will be recorded in Mauritius' BOP. Got it? the company maybe US's buh that doesn't matter when concerned with visible balance.

Thanks a lot. nice explanation.

 

[shanky631]

Trade balance = difference between exports and imports of goods and services.
Visible balance = only goods
Invisible balance = services + Income + Transfers.

Correct me if am wrong anyone!!!???

no, u are right.

 

[Mad Gal]

View attachment 9501
Why is the answer c??????. someone plz explain.

demand for petrol is derived demand. As in increase in demand for cars will lead to an increase in demand for Petrol.
So if price of steel falls, its complement car will be faced by an increase in demand. This will affect the demand for Petrol. So ans = C
was i clear?!

 

[Mad Gal]

Can someone plz explain how to calculate the value of the goods in number ( vii ) and what is meant by ( a sale or return basis ) and what to do with it?
plz help..
and thnx in advance

cost of stock = 1200. Now that it is out of fashion it can be now sold for 800 (NRV) = 1200-400. (am not sure if this is right! If this is the answer, then i should be right )

Sale or return basis, this is when goods sold are not yet accepted by the consumers. As in there's no assurance that it has been sold sold. In such cases, you have to reduce sales and increase your stock level. If the debtor later on accepts the goods, you have to increase debtors, increase sales and reduce stocks.
Am not very thorough with sale or return basis too! Better post it as a separate que and ask for others help too

 

[Mad Gal]

Sale or return basis, can someone give me a proper explanation on how the double entry works.
=> when the customer hasn't informed anything bout the goods being accepted or not?
=> when the customer accepts?
And if there's any other situations. Pleeeeeeeaaaase! You'd do me so much of help

 

[Rashmit Arora]

See brother govt is giving subsidy of 10c per kg.. That means the thing which cost producer 30 will be sell in market at 20...
Initially its at 15c where QD=QS
Now see from top
Price| QD | QS | QS1 |
---30| 11 | 22 | --
---25| 12 | 19 | --
---20| 13 | 17 | 22
---15| 15 | 15 | 19
---10| 17 | 13 | 17

So after subsidy demand and supply will intersect at 10c with QD=17 and QS=17

Thanks! Got it

 

[shanky631]

demand for petrol is derived demand. As in increase in demand for cars will lead to an increase in demand for Petrol.
So if price of steel falls, its complement car will be faced by an increase in demand. This will affect the demand for Petrol. So ans = C
was i clear?!

it's clear. Thanks again