Discuss the below:
Q1 a) Briefly explain the variables that economists focus on when examining an economy?
b) How unemployment rate is defined and describe how it is determined?
Q2 a) What is inflation? Differentiate between inflation and hyper inflation, with examples.
b) Inflation can have a number of negative effects on the economy. Explain at least four of them with some suggestions to tackle such problems.
Q3 a )Does the existence of a shadow or 'black' economy imply that the price system is not working? Is its existence consistent with the laws of demand and supply?
b) The government gains revenue by imposing a sales tax. Who stands to lose the most, the consumer or the producer, or both?
Q4 a) What does the demand curve facing the firm in imperfect competition look like? How is the marginal curve drawn in relation to the demand curve in imperfect competition?
b) In what respect would you expect determinant of demand for computers to differ from the determinants of the demand for milk?
Q5 a) What is the relationship among a firms total revenue, profit and total cost? How are they related?
b) How do economists measure profitability? Explain in detail.