ECO203 End-of-Course Assessment

Section A (Total 65 marks)

Answer all questions in this section.

Question 1a

Assuming there are only two countries, Country X and Country Y trading with each other. Discuss how changes in the national income of Country X can lead to a repercussion effect of its trading partner, Country Y. Using the income determination model, illustrate it with a numerical example when Country X increases its autonomous investment spending by $100 million dollars.

Country X’s marginal propensity to save is 0.10 and marginal propensity to import is 0.40. Country Y’s marginal propensity to save is 0.20 and marginal propensity to import is 0.30.

(15 marks)

Question 1b

In the past few decades, Singapore’s Central Bank, the Monetary Authority of Singapore (MAS) has been maintaining a strong Singapore dollar. Examine the reason for having a strong Singapore dollar and what are the possible problems Singapore might encounter? (Word limit: 500 words)

(15 marks)

Question 2a

Assuming South Korea uses the flexible exchange rate system, and its economy is currently in a recession and a balance of payment surplus with inflationary pressure. Discuss and illustrate a suitable macroeconomic policy mix to address these problems for South Korea’s economy. (Word limit: 500 words)

                                                                                                                  (15 marks)

Question 2b

What are the likely consequences of a trade war when the new president of the USA, Donald Trump imposed new tariffs of Chinese goods on imports from China? Discuss the potential effects on the economic growth and the trade balance between the two countries. (Word limit: 600 words)

(20 marks)

Section B (Total 25 marks)

Answer all questions in this section.

Question 3

For Question 2b, prepare a video recording of the presentation of at least 3 minutes but not exceeding 6 minutes. Refer to Canvas T/TG/RESIT course site > Assignments > ECA_VIDEO for the step-by-step guide on how to submit the video.

(25 marks)

Section C (Total 10 marks)

Answer all questions in this section.

Question 4

Prepare a set of PowerPoint presentation slides upon which the video presentation is based. Please note that the PowerPoint must be converted to PDF before submission to Canvas.

(10 marks)

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