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Econ 341: Money And Banking Question Paper

Econ 341: Money And Banking

Course:Bachelor Of Agribusiness Management

Institution: Chuka University question papers

Exam Year:2012

CHUKA UNIVERSITY

COLLEGE

UNIVERSITY EXAMINATIONS

THIRD YEAR EXAMINATION FOR THE AWARD OF DEGREE OF
BACHELOR OF AGRIBUSINESS MANAGEMENT

ECON 341: MONEY AND BANKING

STREAMS: B.AGBM TIME: 2 HOURS
DAY/DATE: TUESDAY 11/12/2012 8.30 A.M – 10.30 A.M.
INSTRUCTIONS:

ANSWER QUESTION ONE AND ANY OTHER TWO.
DO NOT WRITE ON THE QUESTION PAPER.

QUESTION ONE:

(a) Explain the term money and describe its characteristics. [10 marks]

(b) Explain the meaning and functions of credit. [6 marks]

(c) Explain the shortcomings of the barter trade system. [6 marks]

(d) Distinguish between limited legal tender and unlimited legal tender. [4 marks]

(e) Explain the origin and evolution of commercial banking. [4 marks]

QUESTION TWO:

(a) Discuss the credit creation process by commercial banks and explain the limitations
on the credit creating power of banks. [12 marks]

(b) Discuss the role of commercial banks in economic development. [8 marks]

QUESTION THREE:

(a) Explain the quantitative methods of credit control. How effective are these methods in credit supply control. [8 marks]

(b) Explain the principles of central banking. [8 marks]

QUESTION FOUR:

(a) Discuss the key concerns of a country’s monetary policy. [10 marks]

(b) Explain the four measures of money supply in an economy. [10 marks]

QUESTION FIVE:

(a) Explain the Keynes Liquidity Preference theory of interest rate. Why is it considered to be indeterminate? [10 marks]

(b) Critically examine the Cambridge Cash-Balance of Demand for money. How does it differ from Fisher’s Transactions Approach to Demand for money? [10 marks]

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Econ 341: Money And Banking Question Paper

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