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Buss 115: Macro Economics Question Paper

Buss 115: Macro Economics

Course:Business Administration

Institution: Kenya Methodist University question papers

Exam Year:2011

SCHOOL : SCHOOL OF BUSINESS AND ECONOMICS
DEPARTMENT : BUSINESS ADMINISTRATION
TIME : 2 HOURS
INSTRUCTIONS Answer ALL Questions in Section A and TWO Questions in Section B

SECTION A
Question 1
a) With the aid of a diagram explain the circular flow of income clearly showing the withdrawals and injections in the flow. (10marks)
b) What are the limitations of using national income as a measure of standard of living? Discuss. (10marks)
c) Briefly explain the foreign exchange systems likely to be found in a developing country. (10marks)
SECTION B
Question 2
a) Describe the various causes of inflation in an economy. (10marks)
b) What are the effects of inflation in an economy? (10marks)

Question 3
a) Distinguish between economic growth and economic development. (10marks)
b) Discuss the determinants of economic growth. (10marks)

Question 4
a) Distinguish between Fiscal and Monetary policy. (10marks)
b) What tools are used to effect the fiscal policy? (10marks)

Question 5
a) Discuss the various types of unemployment found in an economy. (10marks)
b) What measures are used to curb unemployment in an economy? Explain. (10marks)

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