Economics Questions and Answers

The IMF is an international organization that was founded in 1944. Its main goal is to promote international monetary cooperation and facilitate international trade. The IMF does this by providing loans to countries that are experiencing balance of payments problems.

A balance of payments problem occurs when a country's imports exceed its exports. This can lead to a shortage of foreign currency, which can make it difficult for the country to pay for imports. The IMF can provide loans to countries with balance of payments problems to help them to cover their import shortfalls and stabilize their currencies. 

National income is calculated mainly to determine the level of sectoral performance.

The level of sectoral performance is important because it can indicate the strength of the economy and the potential for future growth. By measuring the level of sectoral performance, governments can identify areas where the economy is doing well and areas where it needs improvement.

Marginal product is negative at point S on the total product curve. This is because the total product curve is decreasing at point S. When the total product curve is decreasing, the marginal product is negative.

The marginal product is the additional output that is produced when one additional unit of input is added. In this case, the additional output is decreasing, so the marginal product is negative.

The other points on the total product curve, P, Q, and R, are all increasing. Therefore, the marginal product is positive at these points.

To overcome the problem of double counting under the expenditure approach, only spending on final goods are considered.

The expenditure approach to calculating national income measures the total spending on goods and services in an economy. However, this can lead to double counting, as the same good or service can be counted multiple times if it is used in the production of other goods and services.

To avoid double counting, only spending on final goods is considered when using the expenditure approach. Final goods are goods and services that are not used to produce other goods and services. Intermediate goods, on the other hand, are goods and services that are used to produce other goods and services.

By only considering spending on final goods, the problem of double counting is avoided. This is because final goods are not used to produce other goods and services, so they are not counted multiple times.

A government may cause a favourable change in her invisible trade account by developing tourism and other services. Invisible trade account records the movement of services across borders. It includes items such as tourism, transportation, insurance, and royalties.

A government can promote tourism and other services by:

- Investing in infrastructure, such as airports, hotels, and tourist attractions.

- Promoting the country as a tourist destination.

- Providing incentives to businesses that provide services to foreigners.

These measures can help to increase the number of tourists and other service providers in the country, which can lead to a favourable change in the invisible trade account.