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Eco111:Introduction To Macroeconomics Question Paper

Eco111:Introduction To Macroeconomics

Course:Introduction To Macro Economics

Institution: University Of Eldoret question papers

Exam Year:2010

Answer any four questions.All questions carry equal marks.
1.a)Using well labeled diagram,explain the conditions under which the IS and LM curve shift to the right(9marks)
b)Examine the limitations of IS and LM curve(8marks)
c)Discuss the methods that can be used to bring equality between savings and investment.(8marks)
2.a)With specific example from Kenya explain the problems encountered in the measurement of national income (8marks)
b)Explain conditions under which change in national income may not be said to improve the economic welfare of the people.(9marks)
c)What are the limitations of using national income as a measurement of economic welfare?(8marks)
3.a)Briefly examine the various factors that affect consumption function(8marks)
b)Explain the measures that can raise the marginal propensity to consume (9marks)
c)Explain the various factors that determine the investment function (8marks)
4.a)What are the fundamental differences between Keynes theory of employment and the classical theory of employment of the two theories,which is more relevant to kenyan''s scenario?Give reasons for your answer (15marks)
b)Explain keynes psychological law of consumption(10marks)
5.a)Explain the following terms:
i)Induced and Autonomous investment
ii)Personal income
iii)Leakages in multiplier
iv)Real income
v)Pump priming (15marks)
b)Discuss the various determinants of money supply (10marks)
6.a)The phillips curve links inflation and unemployment.Discuss (15marks)
b)Being the government on the measures it should take to curb inflation.Discuss four measures which you would recommend to the government and explain reasons why (10marks)

Eco111:Introduction To Macroeconomics Question Paper

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