Total has discovered a potential 1 billion barrels of “wet” gas off the coast of South Africa. The gas could be used as petrol or perhaps even converted into electricity, according to one expert. The Brulpadda gas find should mean more tax revenue and a stronger rand. How Will It Affect South Africans Firstly, government will earn more tax. Total and its partners will pay the regular 28% corporate tax on all taxable income from Brulpadda. According to the most optimistic estimates, the Brulpadda find could yield $1 trillion (R14.4 trillion) for Total and its partners, which would mean a massive tax windfall for South Africa. Certain Businesses and Skills Will Be in Demand The Brulpadda find could have a massive boost to all kinds of businesses in South Africa. Companies providing helicopters, marine services, catering supplies and transport to get supplies to the site would be required.

4.1 Assuming that government budget is at zero balance discuss the implication of the gas find in terms of government’s fiscal policy for the following economic factors:

4.1.1 Collection of revenue through taxation on personal income (6)

4.1.2 Government spending on the provision of goods and services (7)

4.2 Explain, with the aid of a diagram, the economic impact on cost-push inflation and aggregate output. (12)

4.3 Discuss the main type of unemployment that would be reduced

Samsung and Lg are the two surviving makers of phone operating with android. since they both have the same operating system they are considered virtually identical products to the average consumer, they are marginal cost of producing a phone in MClg=$20 for LG and MCs=20 for samsung. The inverse demand thye jointly face is P=200-2Y where Yg=Ylg+Ys (Ylg are are the phones produced by LGm while Ys are the phones produced by samsung.

1.What are the reaction of functions strategies for LG and for samsung if the market is a cournot duopoly.

2.What is the cournot equilibrium Ys and Ylg

3.What is the bertraqnd equilibrium and Ys ad Ylg

4.2 Question 4.2.1 to 4.2.3 is based on the excerpt below:

SA Household Finances are in Dire Straits The South African Reserve Bank (Sarb) yesterday painted a bleak picture of household finances, saying household expenditure had tanked for the first time in three years. In its quarterly bulletin for June, published yesterday, the central bank said consumption expenditure by households had fallen by 0.8% in the first quarter of 2019 following a 3.2% increase in the fourth quarter of 2018 as the economy wanes. The economy is on a downward spiral with gross domestic product contracting by 3.2% in the first quarter of 2019 – the largest contraction since the first quarter of 2009 when it contracted by 6.1%, at the height of the global financial crisis. The Sarb said the deterioration in the household consumption was in line with the decline in consumer confidence in the first quarter of 2019, as measured by the First National Bank/Bureau for Economic Research Consumer Confidence Index.The Sarb said consumers’ finances had been under pressure due to the prolonged period of weak economic activity, rising unemployment, an increased tax burden and successive fuel price increases. Growth in the real disposable income of households was weighed down by lacklustre employment growth and slower wage growth.

4.2.1 The article states that “the economy is on a downward spiral……first quarter of 2019.” Explain which phase of the business cycle this represents. (5)

4.2.2 The article further states that “growth in the real disposable income……and slower wage growth.” In terms of this statement, discuss the type of fiscal policy that government can implement to remedy this situation, paying specific attention in your answer to the tool that needs to be targeted. (5)

4.2.3 Discuss a demand side policy that can be implemented by government to reduce unemployment mentioned in the article.

On 22 February 2019 Philip Lowe, the Governor of the Reserve Bank of Australia, told the house economics committee:

“I think this country can have an unemployment rate close to 41 per cent 2

[as opposed to the commonly assumed 5, or 51 per cent] without wage 2

growth causing problems for inflation.”

Shortly after, journalist A suggested this is good news for the government. In contrast, two days later, another journalist, journalist B, argued the opposite, that this is bad news for the government, citing the high rate of underemployment in Australia.

1. a) Which well-known macroeconomic concept is Governor Lowe referring to and what is it called?

PLEASE ANSWER EACH QUESTION 1 THRU 4

1. Question text

When a pure monopolist price discriminates, which one of following happens?

Select one:

a. Producer's surplus increases by a samller amount than consumer's surplus decreases.

b. Producer's surplus increases by the same amount as consumer's surplus decreases.

c. Producer's surplus increases by a greater amount than consumer's surplus deacreases.

d. Consumer's surplus increase

2. Question

When is the monopolistic firm is under control of a regulatory commission, which of the following is correct?

Select one:

a. Price may be higher than it would be in an un-regulated monopoly, but output is greater.

b. Price would be at the same level as it would be in un-regulated pure monopoly, but government taxes away the economic profit of the regulated monopoly.

c. Price is theoretically set at the level at which average revenue equals average cost, and only normal profit exists.

d. Price is at the same level as it would be under pur competition.

3. Question

Which describes the best realtionship between technical effciency and allocative efficiency in the long run equlibrium under pure competition?

Select one:

a. They have no relationship with each other.

b. Allocative efficiency is greater than thechnical efficiency.

c. Technical efficiency is greater than allocative efficiency.

d. They are both maximized.

4. Question text

Which market structure has the largest number of firms?

Select one:

a. perfect competition

b. monopoly

c. oligopoly

d. monopolistic competition

QUESTION TWO [30]

2.1 Discuss the concept of price elasticity of demand. Include in your answer an explanation of the relationship of its key variables to the demand curve and the law of demand. (15)

2.2 Using relevant diagrams, explain how income elasticity of demand can help a business to evaluate the service it provides according to changes in demand and consumer income. (15)

5. If people anticipate higher inflation, but inflation remains the same then
a. the short-run Phillips curve would shift right and unemployment would rise.
b. the short-run Phillips curve would shift right and unemployment would fall.
c. the short-run Phillips curve would shift left and unemployment would rise.
d. the short-run Phillips curve would shift left and unemployment would fall.

6. If a central bank increases the money supply in response to an adverse supply shock, then which of the following quantities moves closer to its pre-shock value as a result?
a. both the price level and output
b. the price level but not output
c. output but not the price level
d. neither output nor the price level

7. Suppose the budget deficit is rising 3 percent per year and nominal GDP is rising 5 percent per year. The debt created by these continuing deficits is
a. sustainable, but the future burden on your children cannot be offset.
b. sustainable, and the future burden on your children can be offset if you save for them.
c. not sustainable, and the future burden on your children cannot be offset.
d. not sustainable, but the future burden on your children can be offset if you save for them.

8. Which of the following could the government do to decrease the costs of inflation without lowering the inflation rate?
a. Avoid unexpected changes in the inflation rate.
b. Rewrite the tax laws so that nominal gains were taxed instead of real gains.
c. Make policy that would discourage firms from issuing indexed bonds.
d. All of the above are correct.

9. Real interest rates
a. cannot be negative.
b. can be negative only if inflation is negative.
c. can be negative only if inflation is zero.
d. can be negative only if inflation is greater than zero.

You are a private tution teacher who conducts one-on-one home tuition in economics for senior college students. You are considering growing your business. In particular you are considering vertical and horizontal integration. Using the theory of the optimal boundary of the firm, discuss the make-or buy decision as well as the scope for horizontal integration and diversification of your business. What stages of the vertical chain should you consider conducting in house? What other horizontal markets may you integrate into?

Imagine the following hypothetical situation. Two firms, Super Chic Farm and Fortune Poultry, have become the only suppliers of fresh chicken meat in Singapore. Both firms are seeking to increase their profits and are considering entering into illicit price collusion by agreeing to charge artificially high prices. Such a practice is illegal and risks heavy fines. Analyse the interaction between the two firms using game theory. Present a payoff matrix to model the situation and analyse it for Nash equilibrium. Which is the best outcome for each firm? Which is the best outcome for society as a whole? What can be done by the firms or government to make society’s best outcome more likely?

describe how to apply autonomy in the intervention of a real world issue?

Suppose you are advising the government on sales tax. Should the government tax inelastic goods such as food and medicine or inelastic goods such as Netflix and Hulu subscriptions if the goal of the tax is not to be distortionary? (In which scenario would the tax have the smallest effect on quantity).

During the novel coronavirus (COVID-19) pandemic, the Singapore government introduced lockdown measures and travel restrictions that severely reduced the trade of many small businesses. Singapore government is concerned about business closures, loss of income and unemployment in the markets concerned and is considering further interventions especially as the danger from the virus is beginning to subside. Using the demand-supply model, explain these phenomena in one or two markets of your choice. Advise which market interventions, if any, government should conduct in these markets and why.

How important discount pricing or local residence pricing to rejuvenate the economy in Hawaii now that inter-island travel opening back up.

Also, how the hospitality and travel industry will be setting their prices using external factors affecting pricing decisions.