Econ 341: Money And Banking Question Paper
Econ 341: Money And Banking
Course:Bachelor Of Agribusiness Management
Institution: Chuka University question papers
Exam Year:2012
CHUKA UNIVERSITY
COLLEGE
UNIVERSITY EXAMINATIONS
THIRD YEAR EXAMINATION FOR THE AWARD OF DEGREE OF
BACHELOR OF AGRIBUSINESS MANAGEMENT
ECON 341: MONEY AND BANKING
STREAMS: B.AGBM TIME: 2 HOURS
DAY/DATE: TUESDAY 11/12/2012 8.30 A.M – 10.30 A.M.
INSTRUCTIONS:
ANSWER QUESTION ONE AND ANY OTHER TWO.
DO NOT WRITE ON THE QUESTION PAPER.
QUESTION ONE:
(a) Explain the term money and describe its characteristics. [10 marks]
(b) Explain the meaning and functions of credit. [6 marks]
(c) Explain the shortcomings of the barter trade system. [6 marks]
(d) Distinguish between limited legal tender and unlimited legal tender. [4 marks]
(e) Explain the origin and evolution of commercial banking. [4 marks]
QUESTION TWO:
(a) Discuss the credit creation process by commercial banks and explain the limitations
on the credit creating power of banks. [12 marks]
(b) Discuss the role of commercial banks in economic development. [8 marks]
QUESTION THREE:
(a) Explain the quantitative methods of credit control. How effective are these methods in credit supply control. [8 marks]
(b) Explain the principles of central banking. [8 marks]
QUESTION FOUR:
(a) Discuss the key concerns of a country’s monetary policy. [10 marks]
(b) Explain the four measures of money supply in an economy. [10 marks]
QUESTION FIVE:
(a) Explain the Keynes Liquidity Preference theory of interest rate. Why is it considered to be indeterminate? [10 marks]
(b) Critically examine the Cambridge Cash-Balance of Demand for money. How does it differ from Fisher’s Transactions Approach to Demand for money? [10 marks]
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