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Hps2245:Intermediate Microeconomics Question Paper

Hps2245:Intermediate Microeconomics

Course:Bachelor Of Commerce

Institution: Meru University Of Science And Technology question papers

Exam Year:2011

QUESTION ONE – (30 MARKS)
(a) Differentiate between (8 Marks) (i) Personal income and disposable personal income (ii) Macroeconomics and microeconomics (iii)Consumption demand and investment demand (iv) Absolute advantage and comparative advantage. (b) Briefly discuss the motives of holding money according to Keynesian Theory of money. (9 Marks) (c) Briefly explain the causes of inflation. (9 Marks) (d) Explain the causes of dis-equilibrium in the balance of payment. (4 Marks)
QUESTION TWO – (20 MARKS)
(a) Explain the methods of computing National Income. (9 Marks) (b) Discuss the circular flow of National Income of an open economy; with the help of a diagram. (11 Marks)
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QUESTION THREE – (20 MARKS)
(a) The following is National Income Model of a country: ?? = 130 + 0.6???? ?? = 100 + 0.4?? ?? = 120 ?? = 80 ?? = 100 ?? = 130
Calculate the equilibrium (12 Marks) (i) National income (ii) Tax (iii)Consumption (iv) Investment multipliers (b) Explain the functions of the Central Bank to the government. (8 Marks)
QUESTION FOUR – (20 MARKS)
(a) Discuss the objectives of exchange rate control. (8 Marks) (b) Discuss the tools of monetary policy to control inflation. (12 Marks)

Hps2245:Intermediate Microeconomics Question Paper

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