Desired aggregate expenditure at each level of national income

is shown by the _____ of the AE curve.

A) slope

B) height

C) vertical intercept

D) horizontal intercept

4 List the possible uses for market indices and state the appropriateness for Japanese equities of using the Nikkei Dow 225 and Topix indices against these uses. [6] 5 Compare the main features of investments in offices and shops. [4] 6 Mr and Mrs X are both aged over 70 and own an apartment. Mr and Mrs X will sell the apartment to their daughter Mrs Y on the basis that Mr and Mrs X can live in the apartment rent-free until they are both dead. (1) List the factors you would take into account when calculating the price Mrs Y should offer for the purchase of the apartment. [6] (ii) State with reasons the other factors relevant to Mrs Y's consideration of this investment. [4]You have recently completed a regular review of a large defined benefit pension fund. There has been a recent and major decline in the market value of the fund's assets. The company is keen to avoid increasing its contribution rate both now and in the future. With this objective in mind, the company has asked you to report on the following matters. (1) The fund surplus calculation has been made using the market value of assets. Discuss the appropriateness of such a potentially volatile measure of value given the very long term nature of the future liabilities, including a reference to alternative asset valuation approaches. [5] (ii) The assets of the fund are invested in a range of equity, fixed interest and property investments without any formal regard to the matching of the assets to the liabilities. Describe briefly the principles that might be employed by the fund to better match the value and timing of the assets with the value and timing of the liabilities. Outline the difficulties of trying to implement such a strategy in the case of a pension fund. [4] (iii) For the past several years the fund's investment objective has been to achieve an investment return in any given calendar year that is in the top quartile of returns earned by comparable pension funds. The fund's investment managers have met this objective in four out of the past five years. The fund's investment managers are not constrained as to their choice of investments. State with reasons a proposed replacement objective or change to the current objective and/or any constraints that could be introduced in order to help to meet the company's objective of not increasing its contribution rate to the fund. [6] [Total 15] A large general industrial company has a fast developing information technology and computer services division. This division is expected to generate the majority of the company's earnings over the next five years and the company's broker has sent your fund management team a note recommending they buy the company's latest stock issue. As the sector analyst, your colleagues have asked you to comment on whether the company is likely to outperform its industry sector. (i) List the principal features of general industrial companies. [4] Discuss briefly the factors that will affect the investment performance of all the companies in the sector. [4] (iii) Comment on the broker's recommendation, including any further information your would require. [81Discuss the inefficiency;r of price ceiling and price floor. Explain demand and supply as social adjustment mechanisms. What determines the level of prices in a market. What does a downward sloping demand curve mean about how buyers in a market wili react to a higher price? Will demand curves have the same exact shape in all markets? If not, how will they differ? Will supply curves have the same shape in all markets? If not, how will theyr differ? What is the relationship between quantityr demanded and quantity! supplied at equilibrium? What is the relationship when there is a shortage? What is the relationship when there is a surplus