Economics doubt P3 and P4, post it all in here!

[David Hussey]

is it A?

yea, how?

 

[David Hussey]

is it A?

and what are the theories we should know for Keynesian and monetarists?

 

[Bachelor]

sure will be waiting..
Explain this

heres the logic...
money supply increases the purchashing power..how?
government gives new printed notes to the banks asking them to distribute to the public so they do it by lowering interest as money supply has increased so public withdraws their money from banks as return on savings has been reduced or other people start borrowing as its now cheap so they all start spending...
this pushes up the demand and leads to inflation on if there is spare capacity in the production line to increase the supply..this is happend here..
money supply increased by 20% demand also increased by 20% so inflation shud also have been increased by 20% by it didnt because supply of products increased by 10% so prices were pushed down by 10% so inflation took place of only half of would shud have been

 

[Bachelor]

and what are the theories we should know for Keynesian and monetarists?

monetarisst say money supply leads to inflation due to high spending and high demand..they say controlling inflation should be the priority of the governement instead of unemployment so in order to do that control ur money supply..keynesian say unemployment is a big issue so control it by increasing government spending..

 

[David Hussey]

yea tht simple thing i know man
but mcqs they ask complicated questions about them
http://papers.xtremepapers.com/CIE/...d AS Level/Economics (9708)/9708_w06_qp_3.pdf
q18

http://papers.xtremepapers.com/CIE/...d AS Level/Economics (9708)/9708_s09_qp_3.pdf
q17

 

[Bachelor]

yea tht simple thing i know man
but mcqs they ask complicated questions about them
http://papers.xtremepapers.com/CIE/Cambridge International A and AS Level/Economics (9708)/9708_w06_qp_3.pdf
q18
sorry bro i havent gone deep in kaynesian will go and will reply u by tonite
http://papers.xtremepapers.com/CIE/Cambridge International A and AS Level/Economics (9708)/9708_s09_qp_3.pdf
q17

as i earlier said if there is full emplyment level and demand increases price wont be satble beacause inflation will take place so in the long run when all resources are variable supply of products will increase keeping the prices down and stable..
actually in the short run one variable is fixed i.e machinery or any other capital goods so supply cant be increased i.e full employment level has been reached

 

[David Hussey]

thnx man

 

[David Hussey]

http://papers.xtremepapers.com/CIE/...d AS Level/Economics (9708)/9708_w06_qp_3.pdf
can u also explain q 27 to q30
:/

 

[Bachelor]

http://papers.xtremepapers.com/CIE/...d AS Level/Economics (9708)/9708_w06_qp_3.pdf
can u also explain q 27 to q30
:/

27
labour productivity decreases as labour is increased because increase in output is lower than increase in labour due to short run affect i.e capital is fixed so marginal revenue of labour decreases as workers are added on...gdp increases because population is not affected bt output increased so gdp per head increases...formaula is the key L.P=output/number of workers where as GDP p .h=gdp/population..mathematically if u want to increase any ratio increase the numerator and decrease the denomenator
28 potential output means capacity of the country increased new methods were developed in other words supply increased private investment increased beacause people became confident that this increased due to high demand so invest more and get more..
29 decreasing interest rates will increase demand due to high spending as cheaper to borrow now so recession will be reduced..it will cause the demand to go down for the currency because return on savings is low so people from abroad will withdraw their money from the banks..decreasing exchange rate causes exports cheaper and imports expensive so c account will be in surplus..
30 balanced budget means revenue is equal to spending..in a recession spending is high due to high unemployment so raising taxes will keep the revenue in line with high spending..in boom spending is low as economy is going good employment high so taxes are reduced to decrease the revenue as well in order to have a balanced budget..

 

[Bachelor]

http://papers.xtremepapers.com/CIE/...d AS Level/Economics (9708)/9708_w06_qp_3.pdf
can u also explain q 27 to q30
:/

bye im going to study if u have any other questions post them will answer by tonite 9 pm inshALLAH ..

 

[unique111]

bye im going to study if u have any other questions post them will answer by tonite 9 pm inshALLAH ..

Really helpful! Thank you!

 

[Bachelor]

Really helpful! Thank you!

my pleasure dude

 

[rupa]

hey...
i have a doubt in 9708/03/o/n/08
5th question....pls someone help me
and explain me how that is done???
i am having tough time how to solve marginal utility questions....

 

[Bachelor]

hey...
i have a doubt in 9708/03/o/n/08
5th question....pls someone help me
and explain me how that is done???
i am having tough time how to solve marginal utility questions....

ok girl wait reading

 

[Bachelor]

hey...
i have a doubt in 9708/03/o/n/08
5th question....pls someone help me
and explain me how that is done???
i am having tough time how to solve marginal utility questions....

when u employ an extra worker u have to pay him a higher wage in order to attract him bt u have to increase the wages of previous workers as well so that equality is maintained otherwise they might riot...so basically the formula to find the total marginal cost is
new total wage bill minus previous total wage bill=marginal cost
(X multiply by 31 minus 40 multiply by 30)=102
here they ask u to find the additional rise so our X is the new wage rate when u compare it the difference is two
X=42 previous was 40 so it shud increase by 2 dollar hence A is the answer

 

[:: A^]

when u employ an extra worker u have to pay him a higher wage in order to attract him bt u have to increase the wages of previous workers as well so that equality is maintained otherwise they might riot...so basically the formula to find the total marginal cost is
new total wage bill minus previous total wage bill=marginal cost
(X multiply by 31 minus 40 multiply by 30)=102
here they ask u to find the additional rise so our X is the new wage rate when u compare it the difference is two
X=42 previous was 40 so it shud increase by 2 dollar hence A is the answer

bro what about my milk producer

 

[Bachelor]

bro what about my milk producer

hahahah lol working on it bro its tough bt challenge accepted

 

[David Hussey]

hahahah lol working on it bro its tough bt challenge accepted

and my questions from 27-30

 

[Bachelor]

okay i have a doubt,
can someone explain how the wage will be determination in monopoly market and perfect competitive market....

in perfectly market competiton industry gives the wage rate to the firms just like they give prices of products...now its up to the firm how much to employ so they decide this think via mrpl=mc thoery..mrpl is the change in output due to a change in input of labour it decreases because in the short run capital is fixed so overcrowding takes place decreasing the marginal revenue...MC is the wage rate its constant because no firm can influence the wage rate as they employ small number of workers.....so intersection of both of these gives the number to be employed..
in monoploy firm is the industry as he is the only buyer so he decides again the number to be employed via mrpl=mc bt pays a lower wage rate according to labour supply point in this way he exploits the workers

 

[Bachelor]

and my questions from 27-30

i have uploaded the answers many hours ago see above