7. (a) The CSO calculates the level of National Income in Ireland and three methods are used to calculate it: the income method, the output method and the expenditure method. (1) What do the letters CSO stand for? (il) Explain any one of the three methods used to calculate national income. (iii) State and explain two reasons why it is important to calculate the level of National Income in a country. (b) One possible reason why multinational companies (MNCs) such as Google and Apple locate in Ireland is the low rate of corporation tax. (i) Explain the terms multinational company and corporation tax. (ii) Discuss two other economic reasons why MNCs may locate in Ireland. (iii) Discuss one economic reason why some MNCs may not locate in Ireland. (c) The Multiplier formula for an open economy is: 1 MPS + MPM (i) Explain each of the terms MPS and MPM. Assume that MPS is 0.1 and MPM is 0.4. (ii) Calculate, using the above formula, the size of the multiplier. Show your workings. (iii) Explain the meaning of your answer.5. (a) Maynooth University issues a campus smartcard called 'MyCard', to all its students. This allows users to purchase on campus without using cash. Outline one advantage of a non cash-based method of payment for each of the following: Students University Banks. (b) Some economists are predicting an increase in interest rates within the year. Explain how an increase in interest rates is likely to affect each of the following: Households Firms The Irish Government. (c) One hundred and sixty one post offices are set to close in Ireland in the next year. (Source: RTE News, August 2018) (i) State and explain two possible reasons for the closure of some post offices. (ii) Outline one economic effect which the closure of the post offices may have on each of the following: Customers of the post offices Employees of the post offices The local community. 6. Raising revenue from taxation and reducing tax evasion are important aims of government. (a) (i) Explain the term underlined above and state one example of tax evasion. (ii) State and explain two economic reasons why taxation is essential for an economy. (21 marks) (b) In Budget 2019, the Value Added Tax (VAT) rate for the hospitality sector (hotels, restaurants etc.) increased from 9% to 13.5%. (i) Explain the term Value Added Tax. (ii) Is VAT an example of a direct tax or an indirect tax? Explain your answer. (iii) Outline two possible economic effects on the Irish economy of this increase in the rate of VAT for the hospitality sector. (c) Outline one economic argument in favour of and one economic argument against any two of the following government measures announced in Budget 2019: Increase in social welfare payments of 65 per week Increase of 50c in the price of a packet of 20 cigarettes . Introduction of 2 extra weeks paid parental leave to every parent of a child under one year of age
