A couple of q's (1 Viewer)

[enigma~]

1. Identify the two main methods used to measure World Output (2 marks)

I know one is GWP but what is the other?

2. Demonstrate the difference between a real shock and a financial shock and how each might be transmitted between economies (4 marks)

Any ideas on this one?

 

[StevChe]

hey enigma~ these questions from those sheets the agp developed lol i got stuck on these questions! for question 1 i refered to excel economics and i got GWP and in relation to it both real GDP and population statistics....i didnt get it... but yeh.. for question 2 i had absolutely no idea and the book didnt either cant halp ya on that one soz...

 

[Jago]

try searching for financial shock on bos (this one)

http://community.boredofstudies.org/search.php?

 

[SimbadTheSailor]

Real shocks refer to changes in real variables such as worl output, commodity prices, or technological change. These shocks cause structural changes to occur in the real economy. eg, oil crisis of mid and late seventies.

Financial or monetary shcocks refer to changes in financial variables such as international share prices or a rise in international inflation rates. Financial shocks are transmitted more quickly than real shocks via changes in prices and capital flows (which have greater mobility, naturally, due to information technology and electronic transfer). eg. the dot-com stockmarket bubble collapse during 2000, Wall Street Stock Exchange collapse in 1987.

So basically, knowing that finance refers to movements of capital, speculation on shares, and non-intrinsic value, you can infer that a financial shock impacts on these 'money' variables, as opposed to 'tangible stuff'. lol, for lack of a better expression.

Cheers to Tim Riley, coz that's from his textbook. Dixon doesn't go into that much depth. If you want, look up Asian Financial Crisis, thats a good way of seeing financial shocks translate into real shocks.

Good luck to all doing the test tommorrow!!