short answers

1.

You just earned $25,000 which you deposit it in a bank account, How much can

fractional-reserve banking potentially increase the money supply if only 10% of

the deposit is kept in reserve by the bank.

(4 marks)

2.

When it comes to economic policy on which side of the political spectrum (left or

right) would you normally find the Conservative Party of Canada and the Liberal

Party of Canada? What does this generally mean with reference to their belief

about markets and the need for government intervention and government

spending?

(4 marks)

3.

The Consumer Price Index (CPI) for Canada was 129.7 in February of 2018. In

February 2019 the CPI had risen to 132.5. Calculate the annual rate of inflation

in Canada from Feb. 2018 to Feb. 2019.

(4 marks)

4. Explain 3 types of unemployment with examples.

(4 marks)

:

5.

What is the difference between Nominal GDP and Real GDP. Explain why Real

GDP is used to measure economic growth?