Test

Macroeconomics
Question-1
(a)Define 4
Gross Domestic Product
Economic Growth

Figure shows the economic growth in Ireland in 2007 and 2008.

Year 2007 2008
Rate 10% -3%

(b)With the reference explain the term recession 2

(c)Evaluate the impact of Economic growth in a country. (9)

Question-2
(a)Define (8)
Cyclical unemployment
Structural unemployment
Frictional unemployment
Seasonal unemployment

(b) Evaluate the impact of unemployment in a country. (6)

Question-3
(a)Define inflation (2)

Figure shows the rate of inflation in Vietnam from 2007 to 2009.

Year 2007 2008 2009

Rate 10% 5% 12%

(b) With reference to the data in Figure, describe what happened to prices in Vietnam between
2008 and 2009. (2)

(c)With the example briefly explain the difference between demand pull inflation and costs push
inflation (4)

(d) What is calculated by using the consumer price index (CPI)? (1)
A Redistribution of income
B Inflation rate
C Economic growth
D Exchange rate
(e)What is meant by the term shoe leather costs? (2)

In 2018, the annual rate of inflation in Egypt was 16% in September and 17.7% in October.
(f) Explain one likely impact of this change in inflation on the current account of the balance of
payments for a country such as Egypt. (3)

Question-4
(a) State the formula (3)
Balance of visible trade
Balance of invisible trade
Balance of current account

(b) Identify and explain one problem of balance of payment on current account deficit (4)