ECO82001 – ECONOMICS AND QUANTITATIVE ANALYSIS
SHORT WRITTEN RESPONSES — MACROECONOMICS
WORD LIMIT: 250 words (max.) for each question
Prepare short written responses for the following five (5) questions. Answers for each question must not exceed 250 words.
Question 1 (5 marks)
Explain why real GDP might be an unreliable indicator of the standard of living.
Question 2 (5 marks)
Why does unemployment arise and what makes some unemployment unavoidable?
Question 3 (5 marks)
Consider the following statement: ‘When the average level of prices of goods and services rises, inflation rises’? Do you agree or disagree? Explain.
Question 4 (5 marks)
What is the aggregate demand (AD) curve and why does it slope downwards? Explain.
Question 5 (5 marks)
What is the long run aggregate supply (LRAS) curve and why is it vertical? Why does the short run aggregate supply curve slope upwards?