MACROECONOMICS

Question 2 Marks: 2121 The following information is provided about an open economy with a government. Use the information to answer the questions that follow: C = 450 + {1.41\" I: 35f] G = 15C! K = TU Z = 35 + I[1.1"IIr T: [115? ff = 1550 [1.2.1 Calculate the level of autonomous spending in this economy. {2} [1.2.2 Calculate the size of the multiplier {4} {Note: Rou nd your answer to two decimal places] (1.2.3 Calculate the equilibrium level of income {2} {Hint: use the multiplier method} (1.2.4 Calculate the tax revenue to the government of this country when the economy {2} remains in equilibrium. (1.2.5 Calculate what the new equilibrium income should be if the government of this {5} country decides to cancel all taxes, implying the tax rate would now be {1%. (1.2.15 Before the government decreased the tax rate, how much of government {4} spending was required to bring the economy to full employment? uestion 1 Marks: 20 (1.1.1 Use the table below to answer the questions that follow: [1.11.1 Calculate the inflation rate for the year 2018. {3} [1.11.2 Does the ination rate you calculated above fall into the South Africa {2} ination target? (1.1.2 Use the following composition of expenditure for the economy of a country named the Republic of Tapuwa, for the year ended 2019 to answer the questions below: Consumption expenditure [C] Investment [I] Government spending {G} Exports {Kl Imports [2} Depreciation Foreign payment to the rest of the world Foreign payment from the rest of the world Show all calculations and formulas. [1.12.1 Calculate the value of the countnfs GDE [Gross Domestic [3] Expenditure]. [1.12.2 Compute the value for the country's GDP [Gross Domestic Product] [2] at market price. [1.2.2.3 Determine the value of the country's NNI [Net National Income] at [3] market price. [1.2.2.4 If it is predicted that the GDP will increase to 22 000 in 2020, [3] calculate the growth rate between 2019 and 2020. [1.12.5 The measure of GDP for economic growth is not always perfect. [4] Describe any two problems that are associated with GDP as a measure of economic growth