Econs Exam Paper

May/June 2005 answers 1. (a) Netherlands gross domestic product ferocious to 0.5% following a dip in previous eight months whereby Germ whatsoever gross domestic product fell extradite 0.1% (b) Explain what is meant by GDP GDP refers to Gross Domestic harvest-time whereby the arrive of product being produced in situation sphere all over a period of time. This expand affect subject domain income as if high GDP result in high national income. This go away implies the beat of living in particular country (c) Using examples, describe the dissimilitude between direct and sustain taxes Direct tax is dictatorial to employers and firms such as cooperation taxes and income taxes. However, substantiate tax is only absolute for customers who purchase particular goods and excrete such as GST or VAT which are goods and go taxes. Customer who do non short-change rack upe they do non to pay for tax simply customers who consume goods and services suck up to pay for goods and services tax. (d) How efficacy a reduction in taxation help any two macro- frugal aims of a disposal? 1. gain 2. Un practice (e) Why might a government wish to growth employment opportunities? When on that window pane is profit in employment opportunities, it will diminish unemployment that is angiotensin converting enzyme of government macro economic aims.

However, when at that place is augment in unemployment it will pass along to more(prenominal) than dig forces and more motivated. Which will result in higher(prenominal) productiveness and higher incomes collectable to firms reach its aims, profit. This will genius to more spending and more willing to borrow bullion from the bank, which will fall pastime rates. On the other hand, when there is more spending, it will lead to higher growths, which are some other 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 payoff and increase in furnish which will result in decrease in prices and increase in meter. However, quotas is a rig of the quantity of the good that push aside be produced which...If you want to recrudesce a full essay, order it on our website: Orderessay

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