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Ecs1601 Assignment 6 semester 1 2023
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Ecs1601 Assignment 6 semester 2 2022 The document contains Assignment 6 questions and answers Multiple attempt done Distinction guaranteed
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6/1/23, 4:14 PM Assessment 6: Attempt reviewMENU
Dashboard / Courses / UNISA / 2023 / Semester 1 / ECS1601-23-S1 / Online assessments / Assessment 6
Started on Thursday, 1 June 2023, 3:47 PM
State Finished
Completed on Thursday, 1 June 2023, 4:14 PM
Time taken 26 mins 47 secs
Marks 16.00/20.00
Grade 80.00 out of 100.00
Question 1
Correct
Mark 1.00 out of 1.00
If national income increases from R160 billion to R 250 billion, the money demand for transaction purpose will…………. and the demand curve
for money will…………
a. increase; make a rightward shift.
b. cannot be determined; remain the same.
c. decrease; make a rightward shift.
d. decrease; make a leftward shift.
If national income increases from R160 billion to R250 billion, the money demand for transaction purposes will increase and the demand
curve for money will make a rightward shift.
Question 2
Correct
Mark 1.00 out of 1.00
If the government intends making use of a contractionary fiscal policy, it should …
a. increase the interest rate.
b. decrease taxes and increase government spending.
c. increase taxes and decrease government spending.
d. decrease taxes and decrease government spending.
See section 3.3 of the textbook. A contractionary fiscal policy is a policy that is aimed at decreasing total spending in the economy by
changing taxation and government spending. To decrease total spending, the government needs to increase taxes and decrease
government spending. The spending, the government needs to increase taxes and decrease government spending. The increase in taxes
decreases disposable income of households and they decrease their consumption spending and total spending declines. By decreasing
government spending, less is spend by government on goods and services and consequently total spending declines. Note that the increase
in the interest rate is not part of fiscal policy but part of monetary policy.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=11091176&cmid=622458 1/13
,6/1/23, 4:14 PM Assessment 6: Attempt review
Question 3
Correct
Mark 1.00 out of 1.00
MENU
Which of the following best describes a household?
Dashboard / Courses / UNISA / 2023 / Semester 1 / ECS1601-23-S1 / Online assessments / Assessment 6
a. Any individual who make economic decisions for other people.
b. A group of people who work together.
c. A basic economic unit that utilises factors of production.
d. A family that lives together and makes economic decisions.
Your answer is correct.
Refer to section 3.5. In economics, households can be best described as a family or people who live together and make joint economic
decisions.
Question 4
Correct
Mark 1.00 out of 1.00
Which one of the following statements regarding taxes is correct?
a. Equity in the tax system ensures simplicity and neutrality.
b.
The aim of taxes is to always change the behaviour of people.
c. In a good tax system, compliance costs are equal to administration costs.
d.
Taxes which distort relative prices are not neutral.
Your answer is correct.
When taxes distort relative prices, they affect decisions of consumers and investors in the economy and therefore such taxes are then not
neutral. Review the section on taxation in section 3.6.
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,6/1/23, 4:14 PM Assessment 6: Attempt review
Question 5
Incorrect
Mark 0.00 out of 1.00
MENU
Import tariffs are generally used to protect domestic industries from foreign competition, they often lead to a(n )___________to society.
Dashboard / Courses / UNISA / 2023 / Semester 1 / ECS1601-23-S1 / Online assessments / Assessment 6
a. net welfare gain
b. net welfare loss
c. economic growth.
d. net economic profit.
e. net economic loss.
Your answer is incorrect.
Import tariffs, as part of a range of protectionist measures that governments can use, are duties or taxes imposed on products imported into
a country. They are generally used to protect domestic industries or sectors from foreign competition, but it can be shown that they result in
a net loss of welfare to the domestic economy. See page 70 in the prescribed book.
Question 6
Correct
Mark 1.00 out of 1.00
Which of the following statements are correct examples of final goods and intermediate goods?
a) Thabo buys cake and milk for breakfast at the local supermarket.
b) Sne is a baker and buys milk, flour, sugar and so on to make delicious scones, which she sells to the community.
c) Sibusiso, a farmer, buys seed to plant vegetables.
b
b and c
a and b
a, b and c
c
Final goods are sold to the consumer and the intermediate goods are sold to be used as part of the production process.
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, 6/1/23, 4:14 PM Assessment 6: Attempt review
Question 7
Incorrect
Mark 0.00 out of 1.00
MENU
The introduction of taxes to the Keynesian model…
Dashboard / Courses / UNISA / 2023 / Semester 1 / ECS1601-23-S1 / Online assessments / Assessment 6
a. Causes the consumption function to shift parallel downwards.
b. Cause the slope of the consumption curve to become steeper.
c. Causes the consumption function to shift parallel upwards.
d. Flattens the consumption curve.
e. Increases investment spending at each positive level of income.
When the proportional income tax is introduced to finance part of the government spending, households have to pay a certain portion 𝑡 of
their income in the form of taxes. This reduces their disposable income and therefore also their consumption spending at each level of
income. The consumption (and aggregate) spending curve becomes flatter since a smaller portion of any increase in income is spent on
consumer goods and services
Question 8
Incorrect
Mark 0.00 out of 1.00
Assume that the full-employment income level is higher than the equilibrium income level. Full employment can be reached if
a)exports increase.
b)imports decrease.
c)the tax rate decreases.
a. c
b. All the statements are correct.
c. b
d. a
e. a and c
An increase in exports will raise the equilibrium level closer to the full employment level. The decrease in imports will raise the equilibrium
level to a higher income level. A tax rate decrease will increase the equilibrium level closer to the full employment levels.
https://mymodules.dtls.unisa.ac.za/mod/quiz/review.php?attempt=11091176&cmid=622458 4/13
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