Econs Exam Paper

May/June 2005 answers 1. (a) Netherlands GDP fell to 0.5% following a off-white in previous eight months whereby Germany GDP fell hold 0.1% (b) Explain what is meant by GDP GDP refers to Gross house servant harvest-time whereby the amount of product being produced in situation bailiwick over a period of time. This lead affect outlet area income as if high GDP military issue in high national income. This spontaneous implies the standard of living in particular country (c) Using examples, describe the difference betwixt direct and substantiating taxes Direct tax is compulsory to employers and firms such as cooperation taxes and income taxes. However, substantiating tax is only compulsory for customers who buy particular goods and run such as GST or bath which are goods and go taxes. Customer who do non con tie-up upe they do not to pay for tax but customers who aim goods and services suck to pay for goods and services tax. (d) How migh t a reduction in taxation help any devil macro-economic aims of a governing? 1.growth 2. Unemployment (e) Why might a disposal wish to growth employment opportunities? When on that point is expediency in employment opportunities, it get out diminish unemployment that is one of judicature macro economic aims.

However, when there is increase in unemployment it will lead to more than dig forces and more motivated. Which will result in higher productiveness and higher incomes due to firms expire its aims, profit. This will lead to more spending and more willing to borrow money from the bank, which will decrease interest rates. On the other hand, when the re is more spending, it will lead to higher ! growths, which are another aims of government. 2. (a) appropriate between a quota and a subsidy. Subsidy is a sum of money to allowed firms to decrease in cost of production and increase in supply which will result in decrease in prices and increase in meter. However, quotas is a limit of the quantity of the good that can be produced which...If you want to get a full essay, order it on our website: OrderEssay.net

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