MACRO1 (ECON1010) Assignment 1

MACRO1 (ECON1010) Assignment 1
(Chapter 28, 26&28)
Submit online by: 4PM 11th Sep (Friday) (the ‘Assessment Task’ in Blackboard)
The following information need to be attached in the front page of the submission.

(Note that in the review session for the assignment you will have an opportunity to appeal for remarking. However, you can only do this in the only tutorial that you have registered.)
Tutorial Time and Day: _______________________________________________________________________________________________
Student Name : ________________________________________________________________________________________________________
Student ID: _____________________________________________________________________________________________________________
This assignment covers the following topics:
• Unemployment (Chapter 28)
• Productivity and Growth (Chapter 26)
• Saving, Investment and Financial System (Chapter 27)

READ THE FOLLOWING FIRST (Very Important)

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•
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You only have a single attempt of submission (ensure to attach the final version of the
assignment)
After the due date, online submission will close (after that, you cannot submit online).
Make sure you have included student ID and name in the front page of the assignment
Working with other fellow students is strongly encouraged. However, you cannot just copy your
friend’s answers. If we find out this, you will be harshly punished for the academic plagiarism.
See RMIT’s policy on this http://www1.rmit.edu.au/browse;ID=sg4yfqzod48g1

Instructions to students:
1. This assignment contributes to 15% of the overall marks for the course.
2. Explain your answers, but be succinct.
3. You need to type your answers in MS Word (no hand-writing, please).
4. Label and explain any diagrams, if any, that you use carefully (labelling each axis).

Page 1 of 4

Macro1 (ECON1010), 2sem 2015
Short Answer Questions:
1) (4 marks in total) Compute various indicators of the state of the labour market using the following
information. Please show all of your working. If you do not, you will receive zero marks for the question(s).
Demographic Group

Number of Residents

Full-time workers

7000

Part-time workers

2000

Unemployed and looking for work

600

Unemployed and not looking for work due to
discouragement over job prospects

500

Not working due to disability

300

Not working due to retirement

900

Under the age of 15

3000

Total Population

14300

a) (1 mark) What is the size of the labour force in this economy?
b) (1 mark) Calculate the Labour Force Participation Rate for this economy. Report as a percentage to
two decimal places.
c) (1 mark) Calculate the Unemployment Rate for this economy. Report as a percentage to two decimal
places.
d) (1 mark) Suppose that the natural rate of unemployment is considered to be 5%. What is the rate of
cyclical unemployment? Report as a percentage to two decimal places.

Page 2 of 4

Macro1 (ECON1010), 2sem 2015
2) (4 marks in total)
Below you can find the per capita real GDP of the 13 countries who have joined the European Union (EU) in
2004 (except for Turkey), and the EU average in 1999 (both in Column A). It also gives the GDP per capital
growth rates in 2000 (Column B). Let us assume that countries will keep growing at the given rates until these
countries reach the level of the EU average. Answer the following questions and explain your answers and
show all of your working (in order to obtain partial marks).
Country

Real GDP
per capita in 1999
(before joining EU)
(A)

EU average
Hungary (joined 2004)
The Czech Rep. (joined 2004)
Poland (joined 2004)
Slovenia (joined 2004)
Estonia (joined 2004)
Cyprus (joined 2004)
Malta (joined 2004)
Romania (joined 2007)
Bulgaria (joined 2007)
Lithuania (joined 2004)
Latvia (joined 2004)
Slovakia (joined 2004)
Turkey (pending)

Growth rate
of GDP per
capita in 2000
(%)
(B)

Ratio of per
capita GDP to
EU average in 1999

Years to
double this
ratio

(C)

(D)

$25,660

2.7

–

$5,218

4.8

(Q2 b)

$5,170
$4,257
$9,994
$4,259
$13,389
$13,025
$2,323
$1,691
$3,420
$3,092
$3,818
$6,230

1.5
5.7
3.6
5.5
2.3
4.1
7.3
4.0
4.3
3.6
5.0
2.9

0.2015
0.1659
0.3895
0.1660
0.5218
0.5076
0.0905
0.0659
0.1333
0.1205
0.1488
0.2428

77.8
25.0
50.0
15.2
53.9
43.8
77.8
30.4
350

a) (1 mark) Just observing the above table (doing no calculations), are there any countries that will not be
able to catch up to the level of per capita income in the EU based upon the assumption we have made?
b)

(2 marks) Fill in the information for Column C and D in the above table for Hungary (where it is marked
as Q2b). And then, using the Rule of 70 from the textbook, how many years will the ratio of Hungary’s
GDP to EU average GDP take to double (hint: the growth rate of a fraction is approximately equal to the
growth rate of the numerator minus the growth rate of the denominator)? How many years do you think it
will eventually take real GDP per capita of Hungary to reach that of EU average?

c) (1 mark) The above calculation in part b) is based on the assumption that a country’s real GDP grows at a
constant rate. But in reality it does not. Why is that?

Page 3 of 4

Macro1 (ECON1010), 2sem 2015

3) In this question you analyse the effects of the following economic policies in the loanable funds
market diagram where we have the real interest rate on the vertical axis and the quantity of loanable
funds on the horizontal axis.
a) (2 marks) Demonstrate and explain the effect of a government tax increases in the loanable fund
market. Which of the curves is effected by this—supply or demand—and what direction does it
move. Your explanation must also include what happens to the real interest rate, the level of
national savings, and the level of investment as well.
b) (2 marks) Now you realise that the tax increases that you analysed above also affect the (aftertax) profitability of new investment. How would this change your explanation in Part a)? Again,
use the loanable funds model to demonstrate this effect.
4) (3 marks) The level of government debt is a growing concern for the current Australian Treasurer
Joe Hockey who has the responsibility of managing the government budget. Summarise the key
arguments on the debate around Australian government debt and deficit for the Abbott government.
Your summary must address the following; what is the major concern of running government deficits,
what is the economic reasoning to have a balanced budget and when might a budget deficit/surplus
be ok? Conclude by briefly discussing what policies you would suggest Joe Hockey implement to
balance the budget and why. The summary should be at least half a page in length.

Compelling correspondence is essential to the achievement all things considered but since of the changing idea of the present working environments, successful correspondence turns out to be more troublesome, and because of the numerous impediments that will permit beneficiaries to acknowledge the plan of the sender It is restricted. Misguided judgments.In spite of the fact that correspondence inside the association is rarely completely open, numerous straightforward arrangements can be executed to advance the effect of these hindrances.

Concerning specific contextual analysis, two significant correspondence standards, correspondence channel determination and commotion are self-evident. This course presents the standards of correspondence, the act of general correspondence, and different speculations to all the more likely comprehend the correspondence exchanges experienced in regular daily existence. The standards and practices that you learn in this course give the premise to additionally learning and correspondence.

This question has been answered

This course starts with an outline of the correspondence cycle, the method of reasoning and hypothesis. In resulting modules of the course, we will look at explicit use of relational connections in close to home and expert life. These incorporate relational correspondence, bunch correspondence and dynamic, authoritative correspondence in the work environment or relational correspondence. Rule of Business Communication In request to make correspondence viable, it is important to follow a few rules and standards. Seven of them are fundamental and applicable, and these are clear, finished, brief, obliging, right, thought to be, concrete. These standards are frequently called 7C for business correspondence. The subtleties of these correspondence standards are examined underneath: Politeness Principle: When conveying, we should build up a cordial relationship with every individual who sends data to us.

To be inviting and polite is indistinguishable, and politeness requires an insightful and amicable activity against others. Axioms are notable that gracious “pay of graciousness is the main thing to win everything”. Correspondence staff ought to consistently remember this. The accompanying standards may assist with improving courtesy:Preliminary considering correspondence with family All glad families have the mystery of progress. This achievement originates from a strong establishment of closeness and closeness. Indeed, through private correspondence these cozy family connections become all the more intently. Correspondence is the foundation of different affiliations, building solid partners of obedient devotion, improving family way of life, and assisting with accomplishing satisfaction (Gosche, p. 1). In any case, so as to keep up an amicable relationship, a few families experienced tumultuous encounters. Correspondence in the family is an intricate and alluring marvel. Correspondence between families isn’t restricted to single messages between families or verbal correspondence.

It is a unique cycle that oversees force, closeness and limits, cohesiveness and flexibility of route frameworks, and makes pictures, topics, stories, ceremonies, rules, jobs, making implications, making a feeling of family life An intelligent cycle that makes a model. This model has passed ages. Notwithstanding the view as a family and family automatic framework, one of the greatest exploration establishments in between family correspondence centers around a family correspondence model. Family correspondence model (FCP) hypothesis clarifies why families impart in their own specific manner dependent on one another ‘s psychological direction. Early FCP research established in media research is keen on how families handle broad communications data. Family correspondence was perceived as an exceptional scholastic exploration field by the National Communications Association in 1989. Family correspondence researchers were at first impacted by family research, social brain science, and relational hypothesis, before long built up the hypothesis and began research in a family framework zeroed in on a significant job. Until 2001, the primary issue of the Family Communication Research Journal, Family Communication Magazine, was given. Family correspondence is more than the field of correspondence analysts in the family. Examination on family correspondence is normally done by individuals in brain science, humanism, and family research, to give some examples models. However, as the popular family correspondence researcher Leslie Baxter stated, it is the focal point of this intelligent semantic creation measure making the grant of family correspondence special. In the field of in-home correspondence, correspondence is normally not founded on autonomous messages from one sender to one beneficiary, yet dependent on the dynamic interdependency of data shared among families It is conceptualized. The focal point of this methodology is on the shared trait of semantic development inside family frameworks. As such, producing doesn’t happen in vacuum, however it happens in a wide scope of ages and social exchange.

Standards are rules end up being followed when performing work to agree to a given objective. Hierarchical achievement relies significantly upon compelling correspondence. So as to successfully impart, it is important to follow a few standards and rules. Coming up next are rules to guarantee powerful correspondence: clearness: lucidity of data is a significant guideline of correspondence. For beneficiaries to know the message plainly, the messages ought to be sorted out in a basic language. To guarantee that beneficiaries can without much of a stretch comprehend the importance of the message, the sender needs to impart unmistakably and unhesitatingly so the beneficiary can plainly and unquestionably comprehend the data.>

MACRO1 (ECON1010) Assignment 1

Sample Answer

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