Review the following economic indicators for the Greek economy. http://drive.goo

Question

Review the following economic indicators for the Greek economy. http://drive.google.com/file/d/0B-vDGEamn7d7VDlUbnpaY2lCMjA/view?usp=sharing

1.2. Unemployment rate Greek unemployment has remained at record highs while the youth unemployment still remains about 50%. There is, as a result, an exodus of young educated professionals from the country. Although the unemployment rate has declined, the central bank projects that the unemployment rate will remain steady at this level for some time to come. The labour force participation rate will likely _________ and the unemployment rate will ____________. A.Rise,fall B.Fall,remain steady C.Fall,fall D.Fall,rise

1.3. Types of unemployment The large number of people without a job in the Greek economy is most likely the result of: A. Structural unemployment B. Seasonal unemployment C. Frictional unemployment D. Demand-deficient unemployment

1.4. Unemployment and LFPR The fact that unemployment is rising while the labour force participcation rate is falling is a sign that the Greek economy might be in recovery. True False

1.5. State of the economy Overall, the Greek economy is showing signs of improvement. True False

1.6. Austerity Since 2010, the Greek Government has implemented an austerity program. Based on the data, there is evidence to suggest that this policy may have been somewhat successful in achieving its primary objective. True False

1.7. Austerity Based on the data, it's clear that austerity has been successful in achieving all of Greece's economic objectives. True False

1.8. Consumer spending From the December 2014 to April 2015, consumer spending is likely to have: A. Become negative B. Increased C. Decreased D. Remained constant

1.9. Deflation is not particularly harmful for an economy, hence why Central Banks rarely act to change it. True False

1.10. Fiscal policy Which of the following is most likely to initially influence aggregate supply in the Greek economy? A. An increase in saving B. New infrastructure projects paid for by the government C. Changes in expected inflation D. Changes in personal income tax rates

Read the following statement from RBA Governor, Glenn Stevens: http://drive.google.com/file/d/0B-vDGEamn7d7blhwWW5VblhrWHM/view?usp=sharing

2.1. This article mentions that signs of improvement in investment intentions remain tentative. In the macroeconomy, deteriorating economic conditions could be due to: A. increases in investment spending B. decreases in spending on factories, housing and inventories C. decreases in the national debt D. consumers buying too much on credit

2.2. This article mentions that interest rates are very low and savers continue to look for higher returns in response to low rates on safe instruments. If consumers change their saving and spending plans, it's likely there will be no change in the multiplier. True False

2.3. Growth throughout Europe and the U.S is unlikely to have an impact on net exports for Australia. True False

2.5. According to the RBA, the rate of unemployment is beginning to edge higher. Which of the following causes of unemployment is not associated with an excess supply of labour? A. Minimum wage laws B. Efficiency wages C. Frictional D. Unions

2.6. According to the RBA, resources sector investment spending is set to decline significantly. If resources instead became more productive, this would increase aggregate demand. True False

2.7. One of the central objectives of monetary policy is to reduce income inequality. True False

2.8. "Interest rates are very low and savers continue to look for higher returns in response to low rates on safe instruments". If the RBA decides to further cut interest rates, bond prices are likely to: A. Become negative B. Remain the same C. Decrease D. Increase

2.9. According to the RBA statement, this low interest rate environment has had no impact on housing prices. True False

2.10. "Growth in wages has declined noticeably". A decrease in nominal wage growth is unlikely to have had any impact on the real interest rate. True False

Explanation / Answer

1.2 Option D.

Exodus of young educated youth from Greece will lead to fall in the Labor force Participation rate'

Unemployment Rate = number of unemployed / Labor force participation rate. Any decline in the labor force participation rate and increase in the number of unemployed people will keep the unemployment rate steady.

1.3 Option D.

This is because of the recessionary conditions prevailing in the economy. There is decline in overall level of aggregate demand in the economy. This had led to fall in the level of production in the economy and thus number of people employed had declined. This phenomenon is called demand deficient unemployment.

1.4 False

Migration of youth population to seek employment outside the country and rising level of unemployment do not in any way depict that the Greek economy is showing signs of improvement.

1.5 False

No it cannot be said that Greek economy is improving. GDP levels are low, unemployment is high.

Related Questions

Navigate

• Browse (All)
• Browse R
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.