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EECF62306

UNIVERSITY OF THE FREE STATE

DEPARTMENT OF ECONOMICS

AUGUST 2013

TEST 1

DATE: 13 AUGUST 2013

LECTURERS: MS. C. CAMPHER/ MR. S. GUVURIRO/ MR. C.

MUDZINGIRI

MODERATOR: MR. N. KEYSER

DURATION: 1 HOUR MARKS: 50 

Instructions:

•  This paper consists of 4 questions on 5 pages.

•  Read the questions carefully and please write legibly.

•  Show all calculations where necessary and label graphs clearly.

• 

Round off to four decimal points.•  Answer Question 1 on the optical card provided.

QUESTION 1 [10 x 2 = 20 MARKS]

For Question 1, answer each question on the optical card provided. Only use a PENCIL to

shade in the letter of your choice. 

1.1 

If the consumer price index falls from 120 to 116 in a particular year, the economy has

experienced:

A.  inflation of 4%.

B. 

inflation of 3.33%.

C. 

deflation of 3.33%.

D. 

deflation of 4%.

1.2 If goods and services at nominal prices were included in GDP:

(I)  the GDP would then have to be deflated for changes in the price level.

(II) 

nominal GDP would exceed real GDP.

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(III)  the GDP would be overstated.

(IV)  the GDP would be understated.

A. 

All of the above are true

B.  Only I and II are true

C. 

I, II and III are true

D.  None are true

1.3 

Real GDP was R5,000 billion in year 1 and R5,200 billion in year 2. The approximate rate of

economic growth from year 1 to year 2 was:

A.  0.2%.

B. 

0.4%.

C. 

4%.

D. 

R200 billion.

1.4 Cost-push inflation:

A.  is caused by excessive total spending.

B.  shifts the nation’s production possibilities curve leftward.

C. 

should lead to an increase in potential income of the society.D.

 

is caused by an increase in wage rates.

1.5 Danielle, a BCom Economics student at UFS spends all his pocket money on beer and

cigarettes. In 2011, he bought 60 beers and 20 packets of cigarettes. Prices are shown in the

table below:

Year Beer Cigarettes

2011 R2.50 R7.00

2012 R3.00 R8.00Using the information in the table above, the approximate weights and specific price

indices(SPI) for beer and cigarettes are:

Beer Cigarettes

Weight SPI Weight SPI

A 0.483 114.29 0.517 114.29

B 0.517 120.00 0.483 114.29

C 0.483 83.33 0.517 87.5

D 0.517 83.33 0.483 87.5

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1.6 What is the labour-force status of an autoworker that has been dismissed and would like to

work but has given up hope of finding work?

A. 

Discouraged job seeker

B. 

Technologically unemployed

C. Unemployed voluntarily

D. Cyclically unemployed

1.7 

Suppose the nominal GDP in 2002 (the base year) was R600 billion and the population was

70 billion. In 2004, the nominal GDP increases to R840 billion, the population decreased to

50 billion and the price index was 120. What was the real GDP per capita in 2004?

A. 

R16

B. 

R14

C. 

R20

D. R21

1.8 

In September 2007 there were 30 413 000 persons aged 15 – 65 years comprising the labour

market, of which:

•  13 234 000 persons were employed

• 

3 944 000 persons were unemployed (official definition)

•  13 235 000 persons were not economically active

•  17 178 000 persons were in the labour force

•  3 425 000 persons were discouraged work-seekers.

Using the information above, the official unemployment rate is

A. 

23,0%

B. 25.5%

C. 42.9%

D. 

13.0%

1.9 The aggregate demand curve:

A. 

would be little affected by a technological advancement.

B.  shifts to the right when spending decreases.

C. 

shifts to the left when there is a decrease in taxes.

D. 

cannot move independently of the aggregate supply curve.

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1.10  Along the intermediate range of the aggregate supply curve, an increase in the aggregate

demand curve will increase:

A. 

both the price level and real GDPB.  only real GDP

C. 

only the price level

D.  real GDP and reduce the price level

QUESTION 2 [16]

2.1 Assume that (a) the price level is flexible upward but not downward and (b) the economy is

currently operating at its full-employment output. Other things equal, how will each of the

following affect the equilibrium price level and equilibrium level of output in the short-run?

Write down only the answer- graphs are not necessary.

2.1.1 An increase in aggregate demand. (2)

2.1.2 A decrease in aggregate supply, with no change in aggregate demand. (2)

2.1.3 A decrease in aggregate demand. (2)

2.2 Make use of AD/AS graphs to illustrate the effect of the widespread strikes in the mining

industry on South African output and price levels (4)

2.3 Explain, with the aid of an illustration, the shape of the AS curve. (6)

QUESTION 3 [10]

3.1 Ms. Ndlovu, a student, spends all her income on the following goods and services, in the

following quantities per annum:

Food 200 units

Entertainment 100 units

Skin care products 40 units

Rent 12 units

The prices (per unit) of the above-mentioned items between 2007 (basis year) and 2008 were as

follows:

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Year Food Entertainment Skin care

products

Rent

2007 R50 R100 R110 R1400

2008 R60 R100 R140 R1600

Given Ms Ndlovu’s information, construct a composite price index for the period 2007-2008 and

calculate the inflation rate for the year 2008. Clearly show all your calculations. (10)

QUESTION 4 [4]

4.1 By making use of the data in the table below, calculate the real GDP (expressed at constant

2000 prices) for 1980 and 2005. (4) 

1980 2005

Nominal GDP (R billions) 200 800

Price index (2000 base) 50 120

Population (million) 20 30

TOTAL= 50

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Instruksies:

•  Hierdie vraestel bestaan uit 4 vrae op 5 bladsye.

•  Lees die vrae noukeurig en skryf asseblief netjies.

•  Toon alle berekeninge waar nodig en merk grafieke duidelik.

•

 

Rond af tot vier desimale punte.•  Beantwoord Vraag 1 op die optiesekaart voorsien.

Vraag 1 [10 x 2 = 20]

Vraag 1, beantwoord elke vraag op die optiesekaart voorsien. Gebruik 'n potlood om die letter

van u keuse in te kleur. 

1.1 Indien die verbruikersprysindeks val vanaf 120 tot116 in 'n bepaalde jaar, het die ekonomie:

A. 

inflasie van 4% ervaar

B. 

inflasie van 3.33% ervaar

C. 

deflasie van 3.33% ervaar.

D.  deflasie van 4% ervaar.

1.2 Indien goedere en dienste teen nominale pryse ingesluit is in die BBP:

(I) 

die BBP sal dan moet devalueer word vir veranderinge in die prys vlak.  

(II) 

nominale BBP oorskry reële BBP. 

(III)  die BBP sou oorskat word. 

EECF 62306

UNIVERSITEIT VAN DIE VRYSTAAT

DEPARTEMENT EKONOMIE

AUGUSTUS 2013

TOETS 1

DATUM: 13 AUGUSTUS 2013

DOSENTE: MEV. C. CAMPHER/ MNR. S. GUVURIRO/ MNR. C.

MUDZINGIRI

MODERATOR: MNR. N. KEYSER

TYD: 1 UUR PUNTE: 50 

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(IV)  die BBP sou onderskat word. 

A.  Al bogenoemde is waar

B. 

Slegs I en II is waar

C. 

I, II en III is waar

D. 

Geen van die stellings is waar

1.3 

Reële BBP was R5, 000 miljard in jaar 1 en R5 200 miljard in jaar 2. Die geskatte tempo van

ekonomiese groei van jaar 1 tot jaar 2 was:

A.  0.2%.

B. 

0.4%.C.

 

4%.

D. 

R200 miljard.

1.4 Koste druk inflasie:

A.  word veroorsaak deur oormatige totale besteding. 

B. 

verskuif die land se produksiemoontlikheidskurwe na links. 

C. 

sal lei tot 'n toename in potensiële inkomste van die samelewing. 

D.  word veroorsaak deur ‘n toename in loonkoerse.

1.5 Danielle, 'n BCom-student aan die UV spandeer al sy sakgeld op bier en sigarette. In 2011,

het hy 60 biere en 20 pakkies sigarette gekoop. Pryse word getoon in die tabel hieronder:  

Jaar Bier Sigarette

2011 R2.50 R7.00

2012 R3.00 R8.00

Deur gebruik te maak van die inligting in die tabel hierbo, is die geskatte gewigte en spesifieke

prysindekse (SPI) vir bier en sigarette:

Bier Sigarette

Gewigte SPI Gewigte SPI

A 0.483 114.29 0.517 114.29

B 0.517 120.00 0.483 114.29

C 0.483 83.33 0.517 87.5

D 0.517 83.33 0.483 87.5

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1.6 Wat is die arbeidsmagstatus van 'n werker in die motorbedryf wat afgedank is en wil werk,

maar hoop opgegee het om werk te vind?

A. 

Ontmoedigde werker

B. 

Tegnologies werkloos

C. 

Vrywillig werkloos

D.  Siklies werkloos

1.7 Veronderstel die nominale BBP in 2002 (basisjaar) was R600 miljard en die bevolking was

70 miljard. In 2004 het die nominale BBP toegeneem tot R840 miljard, die bevolking het

gedaal tot 50 miljard en die prysindeks was 120. Wat was die reële BBP per capita in 2004?A.  R16

B.  R14

C.  R20

D. 

R21

1.8 

In September 2007 was daar 30 413 000 persone tussen die ouderdomme van 15-65 jaar in

die arbeidsmark, waarvan:

• 13 234 000 persone indiens was

• 3 944 000 persone was werkloos (amptelike definisie)

• 13 235 000 persone was nie ekonomies aktief nie

• 17 178 000 persone was in die arbeidsmag

• 3 425 000 persone was ontmoedigde werkers

Gebruik die inligting hierbo, die amptelike werkloosheidskoers is: 

E. 23,0%

F. 

25.5%G.

 

42.9%

H. 13.0%

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1.9 Die totale vraagkurwe:

A.  sou min geraak word deur tegnologiese vooruitgang. 

B. 

skuif na regs wanneer besteding afneem. 

C. 

skuif na links wanneer daar 'n afname in belasting is. 

D. 

kan nie onafhanklik van die totale aanbodkurwe beweeg nie. 

1.10 

Langs die intermediêre reeks van die totale aanbodkurwe, sal 'n toename in die totale

vraagkurwe:

A.  beide die prysvlak en reële BBP verhoog

B. 

slegs reële BBP verhoogC.

 

slegs die prysvlak verhoog

D. 

reële BBP verhoog en die prysvlak laat daal.

VRAAG 2 [16]

2.1 Veronderstel dat (a) die prysvlak is opwaarts aanpasbaar maar nie afwaarts nie en (b) die

ekonomie is tans by sy volle-indiensname uitsetvlak. Ander faktore konstant, hoe sal elk van die

volgende die ewewigprysvlak en ewewigsvlak van uitsette in die korttermyn beinvloed? Skryf

slegs die antwoord neer, dit is nie nodig om grafieke te teken nie.

2.1.1 ‘n Toename in totale vraag (2)

2.1.2 ‘n Toename in totale aanbod met geen verandering in totale vraag nie (2)

2.1.3 ‘n Daling in totale vraag (2) 

2.2 Maak gebruik van AD/AS grafieke om die effek van die  wydverspreide stakings in die

mynbedryf op Suid-Afrikaanse produksie en prysvlakke te illustreer.  (4)

2.3 Verduidelik, met behulp van 'n illustrasie, die vorm van die AS kurwe? (6) 

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VRAAG 3 [10]

3.1 Me. Ndlovu, ‘n student, spandeer al haar inkomste op die volgende goedere en dienste in die

volgende hoeveelhede per jaar:

Kos 200 eenhede

Vermaak 100 eenhede

Velsorgprodukte 40 eenhede

Huur 12 eenhede

Die pryse (per eenheid) van die bogenoemde items tussen 2007 (basisjaar) en 2008 was as volg:

Jaar Kos Vermaak Velsorgprodukte Huur

2007 R50 R100 R110 R1400

2008 R60 R100 R140 R1600

Gegewe Me. Ndlovu se inligting, konstrueer ‘n saamgesteldeprysindeks vir die periode 2007-

2008 en bereken die inflasiekoers vir 2008. Toon al u berekeninge duidelik. (10)

VRAAG 4 [4]

4.1 Deur gebruik te maak van die data in die tabel hieronder, bereken die reële BBP (teenkonstante 2000 pryse) vir 1980 en 2005. (4) 

1980 2005

Nominale BBP (R miljard) 200 800

Prysindeks (2000 basis) 50 120

Bevolking (miljoen) 20 30

TOTAAL = 50