Economics for Decision Making: Homework Assignment

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Economics for Decision Making
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Table of Contents
Question 1........................................................................................................................................4
A).................................................................................................................................................4
(I)..............................................................................................................................................4
(II)............................................................................................................................................4
B).................................................................................................................................................4
C).................................................................................................................................................4
D).................................................................................................................................................5
Question 2........................................................................................................................................6
A).................................................................................................................................................6
I)...............................................................................................................................................6
II)..............................................................................................................................................6
III).............................................................................................................................................6
IV)............................................................................................................................................6
B).................................................................................................................................................7
C).................................................................................................................................................7
Question 3........................................................................................................................................9
A).................................................................................................................................................9
B)...............................................................................................................................................10
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C)...............................................................................................................................................11
References...................................................................................................................................12
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Question 1
A)
(I)
Labour force participation rate = labour force/working age population x 100
Number of population = 79634
Labour force participation rate = 72.5%
= 79634*72.5/100
= 57734.65
The 57734.65 population is working in the coffee nation.
(II)
Unemployment rate= number of people unemployed/labour force x 100
Unemployment rate = 6825/57734.65*100
Unemployment rate = 0.118*100
Unemployment rate = 11.82
B)
Labour force = 57734.65-3700
Labour force = 54034.65
As per the case the labour force decreased by 3700 people then the unemployment rate
has been increased. As per case the there is no changes in the unemployment rate,
then the employees are not willing to do the job, and when the employees has not
working with welling then the employees is counted in the employment rate. On other
hand the above statement is the frictional unemployment. In the statement there is
having the 3700 peoples are not capable to do work so that the employees are not
shuttle in the unemployment rate.
C)
 Frictionally unemployed
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Frictionally unemployed is also called the search unemployment, it is based on the
single or individual base (Amadeo, 2019). The frictionally unemployed are spent time for
searching the job or transitioning from one job to another job.
 Structurally unemployed
Structurally unemployed is the mismatch between the jobs available and the skills
levels of the unemployed; they will not gate the specific jobs for the desired (Amadeo,
2019).
 Cyclically unemployed
Cyclically unemployed is the factor of employment because there is having many
changes in the jobs such like ups and downs, or cyclical trends in the organisation
growth and production.
As per Case
As per the statement, this statement is based on the cyclically unemployed because
they have to change or relocate the place with the similar position in the same company
there has been change in trends.
D)
As per the statement is not possible 0% unemployment rate in the country, full
employment (0 present unemployment) is neither practical nor desirable. In the general
economists they do not believe, it is desirable to have 100 employments in an economy.
In the economy, there is a relationship between inflation and unemployment rate; they
both are the reverse combination such like when the unemployment rate is high then
the inflation rate will less. The inflation is high then the unemployment rate is low.
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Question 2
A)
I)
Money multiplier
Money multiplier is the amount which generated with the each dollar of reserves. The
money multiplier is can obtain from the reserves ratio, and the money multiplier is the
reciprocal of the reserves ratio.
Money multiplier = 1/r (reserve ratio)
Money multiplier = 1/0.10
Money multiplier = 10
II)
Net increases = 8300/0.10
Net increases = 83000 – 8300
= 74700
There for, the money supply in the banking system has increases to the reserved from
the ratio. The ratio is having the changes in the money multiplier for the gaining the
more profits or incomes to the bank.
III)
Money multiplier= 8330/ reserve ratio
= 8330/20%
= 8330/0.20
= 41500
Deposit will increase by 33200
IV)
Money multiplier process
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The money multiplier process is the amount, and for the bank is the great point which
earn or generate the money from the each currency of reserves for the earning. The
bank is having the important part which is use from the single or individual customer.
Banks will makes the reserves, and all the reserves will circulated or deposited in the
Federal Reserve requires bank to hold the money and not lend (Pettinger, T., 2017).
Banking is the ratio of reserves which had risen to the total amount of deposits.
B)
The central bank of Thailand has to decreases in the interest rates in the economy to
stimulate business spending. The bank has to decreases then the open market
operations has to take for the decreasing such as the central bank has to purchase the
securities from the other bank that will create the more securities and the they will gate
the large numbers of securities. From purchasing the securities, it will gate the inflation
or the cash will not have and the interest rates will decrease and from that the cash flow
will also reduce.
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C)
Roles of the Reserve Bank of Australia (RBA)
 The first role is the reserve bank of Australia, which is centralised by the Australian
bank, and this is the central bank of Australia. The bank conducts the monetary
policy and issues its currency.
 The reserve bank of Australia is formulating the interest rate from the monetary
policy decisions in terms of the cash rate, and the interest rate on the overnight
loans in the money market (RBA, 2019). The decisions of the reserve bank of
Australia and then the financial institutions will change the interest rates.
 The reserve bank of Australia is not providing the facility to the general public, and it
is not a commercial bank. The bank is providing the facility to the commercial banks,
banking services to some government, and other clients.
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Question 3
A)
I) it has shown in the above diagram.
II) Macroeconomics equilibrium point has shown in the above diagram.
III) Potential GDP has shown in the dark line in the above diagram, and the there is no
inflationary or deflationary gap in the above diagram because the potential GDP is
satisfying the real GDP at the $580. The potential GDP is having the important part of
the economy.
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B)
In the above diagram, it has shown the aggregate demand and aggregate supply, of the
Japanese GDP. The Japanese cars demand has decreased in the japan and all over
the world for the increasing the price of fuel. The demand of Japanese has decreased
for more times than it will also impact the employment of the country. For the
decreasing of the GDP they will impact all the peoples of the country. It will make the
least employment in the organisation.
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C)
It has shown the full employment of the South Korea.
Brief description
As per the video, surging e-commerce exports discussed in the video and that shows
the export in the 2018 that was the 25%, the S. Korea is growing mainly as compare to
the imports of the country. There is main demand in the product of K-beauty, and K-pop
good. It has increased the 31% as compare to the last year (Arirang News, 2019). The
products of K-pop have increased 62% in the 2018. The electronics of the market has
also increased 40% in 2018.
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References
 Amadeo, K., 2019. Frictional Unemployment with Examples, Causes, and Rates.
The balance. [Online] Available at: https://www.thebalance.com/what-is-frictional-
unemployment-examples-causes-rates-3305517 [Accessed on: 03.05.2019]
 Amadeo, K., 2019. Structural Unemployment, Its Causes, and Examples. The
balance. [Online] Available at: https://www.thebalance.com/structural-
unemployment-3306202 [Accessed on: 03.05.2019]
 Arirang News. 2019. S. Korea's e-commerce exports soar 25% in 2018, backed by
growing demand for K-beauty, K-pop goods. YouTube.[Online] Available at:
https://www.youtube.com/watch?reload=9&v=AlRksnES_K8 [Accessed on:
03.05.2019]
 Pettinger, T., 2017. Money Multiplier and Reserve Ratio. Economics. [Online]
Available at: https://www.economicshelp.org/blog/67/money/money-multiplier-and-
reserve-ratio-in-us/ [Accessed on: 03.05.2019]
 RBA. 2019. Questions & Answers about Our Role. RBA. The balance. [Online]
Available at: https://www.rba.gov.au/qa/ [Accessed on: 03.05.2019]
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