National income accounting questions | form six Economics

1. Define

1. Average propensity to save
2. Marginal propensity to save

2. Fill in blanks given a table below:

100. Calculate the investment multiplier given that MPS is 0.5

1. Average propensity to save
2. Marginal propensity to save

Answer / Solution

UNSOLVED

Explain why multiplier is less effective in less developed countries like Tanzania?

Answer / Solution

UNSOLVED

Identify and discuss forms and causes of income inequalities.

Answer / Solution

UNSOLVED

Explain the concepts of inflationary gap, deflationary gap and equilibrium level of income. What policies can be applied to close inflationary and deflationary gaps?

Answer / Solution

UNSOLVED

The following data refers to a hypothetical closed economy where money prices and wage rates and the rate of interest are constant

1. Consumption spending is C=0.8Y
2. Investment spending is I=Tshs 600million
3. Government spending is G=Tshs 2400
4. Income tax is T=0.2Y

1. Calculate the equilibrium level of income
2. Calculate the amount of budget deficit

Answer / Solution

UNSOLVED