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Hcp:Money And Banking Question Paper

Hcp:Money And Banking

Course:Bachelor Of Supplies Management

Institution: Meru University Of Science And Technology question papers

Exam Year:2011

QUESTION ONE – (30 MARKS)
(a) Using a diagram where necessary, explain the different kinds of money. (10 Marks) (b) Explain any five weaknesses of quantity theory of money. (10 Marks) (c) Explain various methods that can be adopted by the central bank of a country to control money supply in a country. (7 Marks) (d) What determines money supply in an economy? (3 Marks)
QUESTION TWO – (20 MARKS)
(a) What are the factors that determine the rate of interest in an economy? (6 Marks) (b) Using a hypothetical example, explain how credit is created and discuss the limitations of the creation of credit. (14 Marks)
QUESTION THREE – (20 MARKS)
(a) Discuss the functions of a Central Bank (10 Marks) (b) Discuss five monetary policies that Central Bank can adapt to increase or decrease supply of money in circulation. (10 Marks)
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QUESTION FOUR – (20 MARKS)
(a) Before money was invented, barter system was prevailing. Explain the difficulties in the barter system that individuals face when making transactions. (10 Marks) (b) Giving examples necessary, explain five qualities of good money material. (10 Marks)
QUESTION FIVE – (20 MARKS)
(a) Discuss quantity theory of money. (10 Marks) (b) A ‘person’ can operate different types of account in a bank. What are they, and what are their different features? (10 Marks

Hcp:Money And Banking Question Paper

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