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Cam 307: Labour Economics Question Paper

Cam 307: Labour Economics

Course:Bachelor Of Commerce

Institution: Kca University question papers

Exam Year:2009

1
UNIVERSITY EXAMINATIONS: 2008/2009
THIRD YEAR STAGE 1 EXAMINATION FOR THE DEGREE OF
BACHELOR OF COMMERCE
CAM 307: LABOUR ECONOMICS
DATE: APRIL 2009 TIME: 2 HOURS
INSTRUCTIONS: Answer question ONE and any other TWO questions
QUESTION ONE
a) The “Supply side” economics of the Obama Administration (2009 – 2012) presumed that income tax
cuts would stimulate incentives to work and thereby increase economic growth. Demonstrate this
outcome with a work – leisure diagram (5 Marks)
b)
No of labour Total physical
product
Price of labour
4
5
6
7
8
9
15
27
36
42
45
46
2
2
2
2
2
2
2
From the above perfect labour market data calculate the following:
(i) Marginal physical product of labour (MPL) (2 Marks)
(ii) Total Revenue Product of Labour (TRPL) (2 Marks)
(iii) Marginal revenue productivity of labour (MRPL) (2 Marks)
(iv) Value of marginal productivity of labour (VMPL) (2 Marks)
c) Discuss five types of labour market discrimination in Kenya (5 Marks)
d) Why is the demand for labour referred to as derived demand? (4 Marks)
e) Explain factors which influence supply and demand of labour (6 Marks)
(Total 30 Marks)
QUESTION TWO
a) What is the effect of a monopsonist in the labour market (5 Marks)
b) Explain with a well labeled diagram how an individual supply curve of labour initially slopes upward
and then backward at higher level of wages. (5 Marks)
c) Unemployment has been major economic concern for developing countries
(i) What are the causes of unemployment in Kenya (5 Marks)
(ii) Suggest economic policies that may be used to reduced unemployment (5 Marks)
(Total: 20 Marks)
QUESTION THREE
a) What are the main objectives of minimum wage legislation? (5 Marks)
b) Discuss the effect of imposing a minimum wage rate with reference:
(i) Competitive market
(ii) Monopsonony (10 Marks)
c) Distinguish between the “substitution effect and output effect” on the members employed by a firm
following a change in wage rate. (5 Marks)
(Total 20 Marks)
3
QUESTION FOUR
a) Discuss Argument Trade Union put forward when demanding for higher wages (10 Marks)
b) What are the limitations of Trade Union unable to raise wages for their members? (10 Marks)
(Total 20 Marks)
QUESTION FIVE
Write short notes on the following
(i) Effects of migration of labour in the labour market (5 Marks)
(ii) Causes of wage differentials between urban and rural economic activities in your country
(5 Marks)
(iii) Discuss factors which limit occupational mobility of labour (5 Marks)
(iv) Cobweb production labour market (5 Marks)
(Total 20 Marks)

Cam 307: Labour Economics Question Paper

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