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Aec 102 :Introduction To Macroeconomics Question Paper

Aec 102 :Introduction To Macroeconomics

Course:Bachelor Of Business Administration

Institution: Jaramogi Oginga Odinga University Of Science And Technology question papers

Exam Year:2014

Jaramogi Oginga Odinga University of Science and Technology (JOOUST)
Department of Business & Economics
EXAMINATION (AUGUST, 2014)

AEC 102 –Introduction to Macroeconomics
Date: Time: (2 hrs)

Instructions

1. The paper contains Five (5) Questions
2. Answer three Questions
3. Question ONE is compulsory with 30 Marks
4. Answer ANY OTHER TWO Questions of 20 Marks each

SECTION A: (Compulsory)
__________________________________________________________________________________
QUESTION ONE
(a) Least Developed Countries (LDCs) usually suffer from low economic growth associated with vicious cycle poverty, low rate of capital formation, rapidly growing population and poor social and political systems. In order to spur economic growth and development, governments in LDCs usually play a key role in economic development.

Required:

State and explain the role of government in economic development (12 Marks)

(b) Distinguish between GDP and GNP ( 3 Marks)
(c) What measures would the government take to curb inflation ( 5 Marks)
(d) What are the essentials of a good tax system ( 10 marks)

SECTION B: Answer ANY TWO Questions
__________________________________________________________________________________
QUESTION TWO
I. Define inflation and explain its effects in an economy (8 Marks)
II. State and explain four canons or principles of taxation (8 Marks)

QUESTION THREE
(a) Explain how both fiscal and monetary policies are used to influence economic development of an economy (6 Marks)

(b) Explain the following market systems:
i. Traditional Economy (4 Marks)
ii. Command Economy (4 Marks)
iii. Market Economy (4 Marks)
iv. Mixed Economy (4 Marks)

QUESTION FOUR
(a) With the aid of a well labelled diagram of Circular follow of Income, show the components of an open economic system ( 10 Marks)
(b) Define the role of government in an economy as a regulator. Give examples in each case (10 Marks)

QUESTION FIVE
(a) National welfare is enhanced by an expansion of goods and services designed to satisfy the needs of the ultimate consumers today and in the future. Based on this criterion, point out

(i) Importance of National Income (7 Marks)
(ii) the limitations of National output as a measure of national welfare (7 marks)

(b) Explain the following economic concepts
I. Scarcity (2 Marks)
II. Choice (2 Marks)
III. Choice ( 2 Marks)

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Aec 102 :Introduction To Macroeconomics Question Paper

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