Get premium membership and access questions with answers, video lessons as well as revision papers.
1. Full employment: unemployment is where some resources are not optimally utilized and are lying idle. Full employment is favored because the greater the level of employment, the greater the amount of goods and services available in the economy. It is also argued that the burden of unemployment and loss of goods and services fall disproportionately on people who are without jobs.
2. Price stability: inflation should be avoided at all times so that prices remain stable and predictable overtime. This is important because inflation affects other people more adversely more than others.
3. Economic growth: economic growth takes place when real output increases more rapidly than the increase in population thus with economic growth the society has more goods and services at its disposal and correspondingly higher standard of living
4. External balance: if a country has a favorable balance of payment, its foreign exchange reserves will increase hence it can import the much needed capital for investment. Unfavorable balance of payment would lead to an outflow of foreign exchange to finance the trade deficit.
Dana05 answered the question on July 18, 2019 at 19:39
- Define the following terms
Economic theory
Economic models
Macroeconomic models
Macroeconomics (Solved)
Define the following terms
Economic theory
Economic models
Macroeconomic models
Macroeconomics
Date posted: July 18, 2019. Answers (1)
- Differentiate between fiscal policies and monetary policies (Solved)
Differentiate between fiscal policies and monetary policies
Date posted: July 18, 2019. Answers (1)
- When is a corporate bond sold at a premium (Solved)
When is a corporate bond sold at a premium
Date posted: July 18, 2019. Answers (1)
- When is a corporate bond sold on a discount (Solved)
When is a corporate bond sold on a discount
Date posted: July 18, 2019. Answers (1)
- What are the advantages of issuing bonds over stocks(Solved)
What are the advantages of issuing bonds over stocks
Date posted: July 18, 2019. Answers (1)
- What are the uses of the yield to maturity(Solved)
What are the uses of the yield to maturity
Date posted: July 18, 2019. Answers (1)
- Differentiate between a bull market and a bear market (Solved)
Differentiate between a bull market and a bear market
Date posted: July 18, 2019. Answers (1)
- Differentiate between the nominal and the real interest rate (Solved)
Differentiate between the nominal and the real interest rate
Date posted: July 18, 2019. Answers (1)
- Explain how the yield curve changes with changes in the short term interest rates in the economy (Solved)
Explain how the yield curve changes with changes in the short term interest rates in the economy
Date posted: July 18, 2019. Answers (1)
- Describe the expectation hypothesis (Solved)
Describe the expectation hypothesis
Date posted: July 18, 2019. Answers (1)
- How does the interest rate affect the prices, demand and yields of bonds(Solved)
How does the interest rate affect the prices, demand and yields of bonds
Date posted: July 18, 2019. Answers (1)
- Highlight the risks faced by bond holders (Solved)
Highlight the risks faced by bond holders
Date posted: July 18, 2019. Answers (1)
- Explain the factors that cause a shift in the bonds demand curve (Solved)
Explain the factors that cause a shift in the bonds demand curve
Date posted: July 18, 2019. Answers (1)
- Discuss the factors that cause a shift in the bonds supply curve(Solved)
Discuss the factors that cause a shift in the bonds supply curve
Date posted: July 18, 2019. Answers (1)
- Give any seven characteristics of preference shares (Solved)
Give any seven characteristics of preference shares
Date posted: July 18, 2019. Answers (1)
- Highlight the characteristics of common shares (Solved)
Highlight the characteristics of common shares
Date posted: July 18, 2019. Answers (1)
- What is the function of brokers and dealers in the secondary market (Solved)
What is the function of brokers and dealers in the secondary market
Date posted: July 18, 2019. Answers (1)
- What is the importance of contractual covenants to money lenders?(Solved)
What is the importance of contractual covenants to money lenders?
Date posted: July 18, 2019. Answers (1)
- Differentiate between the primary and the secondary markets in the issuance of shares (Solved)
Differentiate between the primary and the secondary markets in the issuance of shares
Date posted: July 18, 2019. Answers (1)
- Distinguish between equity and debt (Solved)
Distinguish between equity and debt
Date posted: July 18, 2019. Answers (1)