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How to do this question? I do not know how to draw the ad as-(Answered)


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How to do this question? I do not know how to draw the ad as diagram with those data.

Important: before attempting this assignment, please read the ?notes and instructions? for this assignment.





Question 1A (5 marks)


The table below reports some labour market figures for a hypothetical country, Blefuscu


in 2005. Assume that there are only two types of employment: full time and part time.


Everyone who is not employed is unemployed. Calculate the Labour force participation


and ii) unemployment rate. Show all your calculations. (5 marks)



Question 1B (5 marks)


The government of Blefuscu announces that the unemployment rate fell from 2005 to


2006. The government says this is positive news as it shows more jobs are being created


and less people are unemployed. The labour unions, on the other hand, disagreed with


this assessment and stated that they could find no evidence that additional jobs have


been created between 2005 and 2006.


Your task is to explain how the unemployment rate can fall even if there are no new jobs


being created. First, using the numbers you have been given in 1A as the 2005 figures,


fill in the table below by developing a set of numbers that show how the unemployment


rate can fall even if there are no new jobs being created. Assume no change between


2005 and 2006 in the population, percentage of part time workers and working age population. Second, discuss in detail how the numbers show the unemployment rate can fall


even if there are no new jobs being created. List two possible reasons why this may occur.


Question 2


Economists are deeply puzzled by our desire to have children. First, kids are really expensive - the biggest financial decision most couples will make. Forget


the cost of buying the family home; the kids you choose to populate it with will


end up costing just as much, or more, over a lifetime. A survey released last


week by AMP and the National Centre for Social and Economic Modelling


found the typical Australian family spent $812,000 raising two kids. This is an


increase of nearly 50 per cent in just six years. ?Economists like to assume we


are rational individuals who make decisions based on anticipated costs and benefits.


-The Sunday Mail (Qld) May 26 2013


You are the senior Economic advisor to the Prime Minister who is currently considering


how to reduce the cost of having children and promote more economic growth. Some


of her party want to continue John Howard?s ?baby bonus? scheme that provides a lump


sum of cash to parents upon the birth of a child. Others argue that the government



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should instead aim to focus on lowering the costs of educating children by making tertiary education free.


0) Discuss how each of these options will affect wages and labour productivity, potential GDP and real GDP. Will they lead to growth in real GDP and rises in real


GDP per capita? use the potential GDP and labour market diagrams in your answer. (6 marks)


0) Imagine that whatever strategy will be chosen, it will be kept for the next three


decades. In terms of achieving growth in the long run, discuss which strategy


would lead to higher growth rates and explain why (2 marks)


0) How would each strategy affect the standard of living? (2 marks)



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Question 3


Hint: For this question read the textbook about the great recession (a.k.a the GFC) on


page 135 and page 308-309 of the textbook. Page 304 to 305 of the textbook provides


some information for Australia Each student is assigned a country. You can find your


country in the "Markcentre".


I. Go to the following website:


II. This data is sourced from the IMF's World Economic outlook. Find data for the


country you have been assigned to? see mark centre for more information.


III.Select "national accounts" and choose "GDP, constant prices, % change", This is


real GDP. Select your country from the list and also select Australia. Choose the


years 2004 to 2016 using the ruler at the bottom of the page. Use "print screen"


to copy and paste them into your assignment document


IV. Repeat the same exercise to create a second graph for the unemployment rate - see


"People" and "Unemployment rate %"


V. Repeat the same exercise to create a third graph for inflation - see "Money" ->


"Inflation, average consumer prices (%):


Question 3A (6 marks)


Use the information from the graphs above and your own research to draw a AD-AS diagram for the country you have been assigned to and Australia at three points in time:


2005, 2007 and 2012.


The AD-AS should clearly show the price level, Real GDP and unemployment rate.


Clearly identify either a Recessionary gap, inflationary or the long run equilibrium at


the each time point.


Briefly explain what evidence you have used to justify your graph. You may use any in formation from credible sources (wikipedia and similar websites are NOT credible). We


highly recommend using the IMF's World Economic outlook reports from 2004 to 2012


found here:


Question 3B (2 marks)


For the country you have been assigned to (not Australia), do research and explain what


happened in the economy between 2005-2007 and 2007-2012. Show how these changes


took place by shifting the appropriate lines in a AD-AS diagram.


Question 3C (2 marks)



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Based on both research and the above figures, briefly discuss whether the country you



have been assigned to and Australia was hurt more by the GFC in terms of changes in


real GDP and unemployment.



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Paper#9256439 | Written in 27-Jul-2016

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