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Eet 101.Macroeconomics Theory 1 Question Paper

Eet 101.Macroeconomics Theory 1

Course:Bachelor Of Economics

Institution: Kenyatta University question papers

Exam Year:2015

KENYATTA UNIVERSITY
UNIVERSITY EXAMINATION 2014/2015
SECOND SEMESTER FOR THE BACHELOR DEGREE OF ECONOMICS,BACHELOR OF COMMERCE,BACHELOR OF ARTS ,BACHELOR OF EDUCATION
EET 101.MACRO ECONOMICS THEORY 1
DATE FRIDAY 27TH MARCH 2015 TIME 11:00-1:00PM
INSTRUCTIONS .Answer Question one and any other two questions
a)The structure model of Jamhuli economy is given as below
C=500+0.7Yd consumption function
I=270
G=250
T=200
REQUIRED
i))Derive the saving function(2marks)
ii)Derive the government expenditure multiplier explain your answer(3marks)
iii)compute the equilibrium income(Y)and consumption (c)(5marks)
b) briefly examine the four goals of macroeconomics policy(4marks)
c)define the following terms(6marks)
ratchet effect
liquidity trap
money illusion
d)explain five factors that influence a country''s national income(5marks)
e)clearly explain five types of unemployment and their causes(5marks)
Question 2
a)using a well labeled flow diagram discuss the injections and withdraws in the economy''s income.(10 marks)
b)explain the factors that determine the investments in a country(10 marks)
Question 3
a)using a diagram show the derivation equilibrium in the good market(8 marks)
b) describe the Keynesian theory of money demand highlighting the factors that determine money demand in the country(12 marks)
Question 4
a)with the aid of a well labeled diagram,describe the life cycle income hypotheses of consumption behavior.(10 marks)
b)describe five desirable properties of money as a medium of exchange(5 marks)
examine the limitations peer capita income in measuring social welfare(5marks)
Question 5
a)examine the measures the government Kenya can use to curb inflation using examples(10 marks)
b)With the aid of well labeled diagrams show the difference between the following
demand full inflation
cost push inflation (10 marks)

by fredy ku kitui

Eet 101.Macroeconomics Theory 1 Question Paper

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