Question
In: Economics
DURBAN FIRMS PRODUCING ONLY TWO GOODS, DIAMOND AND GOLD. THE PROCEED OF WHICH IT USES TO...
DURBAN FIRMS PRODUCING ONLY TWO GOODS, DIAMOND AND GOLD. THE PROCEED OF WHICH IT USES TO PURCHASE GOODS AND SERVICES FROM NEIGHBORING TOWNS THROUGH BANKS. DISCUSS THE CIRCULAR FLOW OF INCOME AND SPENDING IN DURBAN.
Solutions
Expert Solution
Answer:
As all other institutions in an economy are prevalent in the
island, circular flow of income and spending in Durban town is as
mentioned below:
- As all purchase of goods other than cotton and gold is being done only Via banks, the bak can issue virtual credits or paper form of credit for the amount of Diamond and Gold, that a person can submit to the bank.
- That virtusal credit can be used by everyone in the island to purchase any other goods.
- Even from the bank we can submit the virtual credit that we get by selling Diamond and Gold to the bank purchase other commodity which bank purchase from outside by giving them gold and cotton, which can be sold to all the persons in the island as the cost of Virtual cedit or paper credit provided by the bank.
- So flow of income and comodity is happening via Virtual cerdit which is handy and available with everyone.
- Even employer can pay their employees or for their services in the form of Virtual cerdit which they can use to purchase food and other necessity.
- Referencing is always done between gold and Diamond and this virtual credit to maintain balalnce in the economy, and their fluctuations can bring inflation in the island economy.
- Value produced by the town can be counted in terms of amount of Gold and Diamond which is exported to neighboring town compare to the import value. Town will be in trade surplus if export is more than the import which is there.
(plz give me a thums up...if my answer helped you and if any suggestion plz comment, Yr thums up boost me)
Rahul Sunny answered 2 years agoRelated Solutions
Consider the hypothetical example of Dominion Island that has firms producing only two goods, gold and...
Consider the hypothetical example of Dominion Island that has
firms producing only two goods, gold and cotton, the proceeds of
which it uses to purchase other goods and services from
neighbouring islands through its banks. Assuming that all other
required institutions in an economy are prevalent in this island,
discuss the circular flow of income and spending in Dominion
Island. No diagram is required.
Consider the hypothetical example of Dominion Island that has firms producing only two goods, gold and...
Consider the hypothetical example of Dominion Island that has
firms producing only two goods, gold and cotton, the proceeds of
which it uses to purchase other goods and services from neighboring
islands through its banks. Assuming that all other required
institutions in an economy are prevalent in this island, discuss
the circular flow of income and spending in Dominion Island. No
diagram is required.
Consider the hypothetical example of Dominion Island that has firms producing only two goods, gold and...
Consider the hypothetical example of Dominion Island that has
firms producing only two goods, gold and cotton, the proceeds of
which it uses to purchase other goods and services from
neighbouring islands through its banks. Assuming that all other
required institutions in an economy are prevalent in this island,
discuss the circular flow of income and spending in Dominion
Island. No diagram is required.
consider the hypothetical example of Dominion Island that has firms producing only two goods, gold and...
consider the hypothetical example of Dominion Island that has
firms producing only two goods, gold and cotton, the proceeds of
which it uses to purchase other goods and services from
neighbouring islands through its banks. Assuming that all other
required institutions in an economy are prevalent in this island,
discuss the circular flow of income and spending in Dominion
Island. No diagram is required.
consider Consider the hypothetical example of dominion Island that has firms producing only two goods, gold...
consider
Consider the hypothetical example of dominion Island
that has firms producing only two goods, gold and cotton, the
proceeds of which it uses to purchase other goods and services from
neighboring islands through its banks. Assuming that all other
institutions in an economy are prevalent in this island, discuss
the circular flow of income and spending in dominion Island
consider the hypothetical example of dominion island that has firms producing only two goods,textiles and sugar,the...
consider the hypothetical example of dominion island that has
firms producing only two goods,textiles and sugar,the proceeds of
which it used to purchase other goods and services from other
countries through its bank .Assuming that all other required
institutions in an economy are prevalent in this island,discuss the
circular flow of income and spending in dominion island.
20a) ________ goods are those that firms buy for use as inputs in producing other goods...
20a)
________ goods are those that firms buy for use as inputs in
producing other goods or services and they ________ counted in
GDP.
Final; are not
Intermediate; are
Final; are Final; are
Intermediate; are not
b)
Exland’s gross domestic product is the nominal value of which of
the following?
Final production by Exland’s resources
Final production within Exland’s borders
Production within Exland’s borders
Production by Exland’s resources
c)
Many residents of West Virginia cross the border to work in...
An economy uses only labor as input to produce two goods, A and B. If its...
An economy uses only labor as input to produce two goods, A and
B. If its production possibilities frontier (PPF) of two goods is a
negative-sloped straight line, what is the implication in
opportunity costs? Will the law of increasing costs still hold?
Please state briefly.
QUESTION TWO (20 Marks) Consider the hypothetical example of Dominion Island that has firms producing only...
QUESTION TWO
Consider the hypothetical example of Dominion Island that has firms
producing only two goods, gold and cotton, the proceeds of which it
uses to purchase other goods and services from neighbouring islands
through its banks. Assuming that all other required institutions in
an economy are prevalent in this island, discuss the circular flow
of income and spending in Dominion Island. No diagram is
required
[1] A producing sector classification for grouping goods, services, and the firms that produce them: A)...
[1] A producing sector classification for grouping goods,
services, and the firms that produce them:
A) is broader than an industry classification.
B) is narrower than an industry classification.
C) includes the same number of firms as an industry
classification, but arranges the firms differently.
D) may be broader or narrower than an industry classification,
depending upon the types of products classified.
[2] Over most of the twentieth century, the dominant producing
sector in the U.S. economy was:
A) services....
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- St. Johns River Shipyards' welding machine is 15 years old, fully depreciated, and has no salvage...
- The following information is available for Robstown Corporation for 20Y8: Inventories January 1 December 31 Materials...
- /* Complete the TO DO comments below */ window.onload = function() { /* TODO add a...
- Trevor Price bought 10-year bonds issued by Harvest Foods five years ago for $4,532.35. The bonds...
- How do you represent 5.1 (5 + 1/10) in binary? I know that it is 0101....
- More and more adults are considering commuting to work by bicycle rather than car, but few...
- Please answer these questions Data Processing and Analysis using python. Thank you In statistics, an outlier...
ADVERTISEMENT