What are the topics of Paper 2 Economics Grade 12?
- Circular flow.
- Business cycles.
- Public sector.
- Foreign exchange markets.
- Protectionism and Free Trade.
How do cartels and price leadership differ in terms of the way prices are manipulated?
In a cartel type of collusive oligopoly, firms jointly fix a price and output policy through agreements. But under price leadership one firm sets the price and others follow it. The one which sets the price is a price leader and the others who follow it are its followers.
How could the South African Reserve Bank have prevented the business cycle from plunging?
2.5 How could the South African Reserve Bank have prevented the business cycle from plunging to T3? The Reserve bank can: adjust the repo rate downwards, that will lead to lower interest rates √ √ decrease cash reserve requirements to make more money available at banks, for loans √ √
How do you convert GNP to GDP?
GDP (Gross Domestic Product) is a measure of (national income = national output = national expenditure) produced in a particular country. GNP (Gross National Product) = GDP + net property income from abroad. This net income from abroad includes dividends, interest and profit.
What is the subject economics all about?
Economics is the study of scarcity and its implications for the use of resources, production of goods and services, growth of production and welfare over time, and a great variety of other complex issues of vital concern to society.
Why does the performance of natural monopolies deny the long run equilibrium position of a monopoly?
Natural monopolies’ performances are not always in line with the long-run equilibrium position of a monopoly because: compared to a typical monopoly where economic profit always prevails over the long run, natural monopolies do not enjoy the benefits experienced by other monopolies √√
How price and output is determined under joint profit maximization of cartel?
The cartel solution-that maximizes joint profit is determined at point Σ where the Σ MC curve intersects the industry MR curve. Consequently, the total output is OQ which will be sold at OP = (QF) price.
How does free trade lead to economies of scale?
Free trade means that countries can import and export goods without any tariff barriers or other non-tariff barriers to trade. Essentially, free trade enables lower prices for consumers, increased exports, benefits from economies of scale and a greater choice of goods.
What is an exogenous factor that affects the business cycle?
Exogenous causes are factors that influence the business cycle from outside of the system, e.g. climate (drought and other natural disasters) and the political situation of a country. Endogenous causes are factors that influence the business cycle from inside the system, e.g. total expenditure.
What is the relationship between the marginal tax rate and the multiplier?
Changes in the size of the leakages—a change in the marginal propensity to save, the tax rate, or the marginal propensity to import—will change the size of the multiplier.
How do imports of goods and services affect the multiplier?
An increase in the marginal propensity to import increases the value of the denominator on the right-hand side of the equation, which then decreases the overall value of the fraction and thus the size of the multiplier.
Who is father of economics?
Adam Smith was an 18th-century Scottish philosopher. He is considered the father of modern economics.