ECS1601 ASSIGNMENT 1

ECS1601 ASSIGNMENT 1 SM 2 2020/2021 The three major flows in any economy are … [1] income, spending and saving. [2] income, government spending and consumption. [3] spending, production and investment. [4] production, income and spending. The two major markets in the circular flow of income and expenditure are the … [1] foreign exchange market and factor market. [2] goods market and factor market. [3] goods market and services market. [4] factor market and production market. Which one of the following statements on the remuneration of the factors of production is true? [1] The remuneration for capital is profit, as the business aims to earn a profit on its financial investments. [2] The remuneration for labour is rent, as workers are able to pay their rent with the money they earn. [3] The remuneration for entrepreneurship is a salary, as entrepreneurs are also rewarded for their efforts. [4] The remuneration for natural resources is rent, as natural resources consist of all gifts of nature. The following are different Factors of production and their rewards Natural resources (Land) rent Capital Interest Labour Wages /Salary Entrepreneurship Profit 4.In the circular flow of income and spending in South Africa, firms in the factor market becomes households, while households in the goods market becomes firms. Expenditure by foreigners on South African products constitutes the circular flow. [1] income to; spending by; income to; spending by; a leakage from [2] income to; income to; spending by; spending by; an injection into [3] spending by; income to; spending by; income to; an injection into [4] spending by; spending by; income to; income to; a leakage from In the circular flow of income and spending, financial institutions … [1] act as an intermediary between those who have surplus funds and those who have deficit funds. [2] are not always useful, as households generally spend all their available funds. [3] create an injection into the flow by collecting savings from participants with surplus units only; therefore, there is no need to provide funds to deficit units. [4] generally exist to collect investment spending and transform it into savings. Which of the following is a leakage from the circular flow of income and spending in South Africa? [1] government purchases of textbooks for state-run schools [2] the sale of export fruit to the European Union [3] investment by South African Breweries in a new brewery in South Africa [4] a decision by a major supermarket chain to sell German beer If the Minister of Finance wanted to withdraw funds from the economy using the flows of income, spending and production, you would advise him to … [1] increase government spending to firms. [2] decrease government spending to firms. [3] increase spending on public goods and services. [4] increase taxes received from households. Money overcomes the problem of a double coincidence of wants inherent in the barter system through its function as a … [1] medium of exchange. [2] unit of account. [3] standard of deferred payment. [4] store of value. The most comprehensive measure of money is equal to … [1] M2 plus all short-term and medium-term deposits of the domestic private sector with monetary institutions. [2] M1 plus all short-term and medium-term deposits of the domestic private sector with monetary institutions. [3] M2 plus all long-term deposits of the domestic private sector with monetary institutions. [4] M2 plus all medium-term deposits of the domestic private sector with monetary institutions. Based on your answer to question 9, use the table below to find the total comprehensive measure of money for the year 2013. [1] R87 014 million [2] R549 323 million [3] R636 337 million [4] R2 513 865 million In the circular flow of income and spending, government … [1] Injects government spending into the factor market and collects taxes from the goods market. [2] Withdraws taxes from firms and households. [3] Provides public goods and services to the factor market and receives labour from the goods market. [4] Withdraws government spending by providing it to firms and withdraws taxes from households. Which one of the following is a function of the South African Reserve Bank? [1] To formulate and implement fiscal policy [2] To maintain financial stability [3] To finance government expenditure [4] To provide public goods and services CONTINUED....................DOWNLOAD FOR BEST REVISION AND BEST SCORES