Business Economics Asst 2

This assignment must be submitted no later than 7th August 2014 2359

BUSINESS ECONOMICSASST 2

You are required to type up and submit a Word document file which will include your answers to the above two questions.

In preparing your answers to the assignment, you are required to follow the specific guidelines below: You are to work on this assignment individually without the help of others. Your answer should be grounded in relevant economic theories. The word limit for Question 1 is between a minimum of 800 and a maximum of 1000 words, and for Question 2 a minimum of 400 and a maximum of 500 words. Use Times New Roman or Arial 12 pt with 1.5 spacing between lines. Pages must be numbered. Headings and sub-headings should be clear and visible. The text should flow smoothly, with each section leading naturally and logically to the next one. This assignment is due one day before the end of the course end date. Late submissions will not be accepted. Reference all sources appropriately using the Harvard Referencing system. Note that although you may include direct quotes from various sources of information, your answer should not merely be other people’s work. That is, even if you identify the sources of information that you use, you should not copy too much information directly from other sources. Try to paraphrase as much as possible and include your own thoughts in your answers. Even if you paraphrase you still need to identify the source of information. When you copy directly be sure to identify the pages. Finally, when you include your own thoughts be sure to justify them with supporting references. All assignment answers will be checked for plagiarism using TurnItIn. This assignment comprises 30% of your total course grade. To pass the course you must obtain an overall grade of at least 60%.

Answer both questions below

.

Total assignment marks: 100

Your answers to this assignment should include references to recently published journal

articles or books, media news as well as information on the web. Where

appropriate you

are encouraged to challenge relevant economic theories providing your own justified

views.

Question 1

Critically analyze the short and long term effects of a large budget deficit and public

(national) debt. In your answer, provide an explanation of what the public debt is and

how it can be financed. You should also critically evaluate the various

austerity measures that are usually recommended for reducing a budget deficit and national debt.

Be sure to explicitly give examples of these austerity measures.

(This question may be answered in the light of the recent events and economic situation in

countries such as Greece, Cyprus, Portugal and Spain.)

(70 marks)

Question 2

Some people (especially economists) argue in favor of international free trade while

others favor protectionism. Critically examine who gains and who loses from free trade and protectionism. Overall

do you think that international free trade is a good idea for your country (Nigeria)?

(30 marks)