1.17 Read the following and answer questions 1.17 - 1.18. Oregon marked a milestone last month by returning to pre-pandemic employment levels, rebounding much faster than during prior recessions. But some sectors, notably hospitality, havent fully recovered. Thats largely because of an ongoing worker shortage that has constrained businesses ability to staff up. The unemployment being addressed in the above quote is... (4 marks) a) Cyclical unemployment b) Seasonal unemployment c) Hidden unemployment d) Frictional unemployment 1.18 The costs to the hospitality industry being presented in the above quote are (4 marks) a) Social cost b) Economic cost c) Political cost d) Distribution cost 1.19 According to Keynesian economists, during a boom in economic activity (4 marks) a) money supply should be increased. b) interest rates should be cut. c) government should increase its spending. d) tax rates should be raised. 1.20 Interest rates are usually ________ during the latter stages of a downswing in the South African business cycle. An improvement in economic activity is normally triggered by an increase in ________. Manufacturing production rises during an upswing and in the latter stages of the upswing, inflation, and interest rates ________. (4 marks) a) low; exports; increase b) low; consumption; fall c) low; imports; fall d) high; exports; increase 1.21 Which one of the following is not a supply factor in economic growth? (4 marks) a) Consumption spending b) Natural resources c) Labour d) Capital 1.22 Which of the following statements is true? (4 marks) a) If A has an absolute advantage over B in producing good X, then A also has a comparative advantage. b) If A has a comparative advantage over B in producing good X, then A can produce X at a lower cost. c) If A has a comparative advantage over B in producing good X, then A also has an absolute advantage. d) If A has a comparative advantage over B in producing good X, then A can produce X at a lower opportunity cost. 6 1.23 If two countries have differing opportunity costs of production for two goods, then: (4 marks) a) each country should specialise in the good for which it has a higher opportunity cost of production. b) only the country with an absolute advantage in the production of both goods stands to gain from trade. c) each country should purchase inputs from the other country in order to gain an absolute advantage. d) each country should specialise in the production of the good for which it has a comparative advantage.