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Bhr 105: Introduction To Macroeconomics Question Paper

Bhr 105: Introduction To Macroeconomics

Course:Bachelor Of Science In Human Resource Development

Institution: Moi University question papers

Exam Year:2015

SECTION A (COMPULSORY)

1.(a)Explain the circular flow of income in a three sector economy.(6mks)
(b)Outline the limitations that one may encounter in measuring national income using the national product method.(6mks)
(c)From the following data calculate the GNP of the economy concerned.(6mks)

ITEM AMOUNT IN BILLION SHS.
Net property income from abroad 60
Consumer expenditure 500
Increase in stock and work progress 20
Import of goods and services 120
Government final consumptions 90
Export of goods and services 120
Gross domestic fixed capital formation 80
Depreciation 50
Taxes on expenditures 40
Subsidies 15

(d)Explain the uses of national income statistics(4mks)
(e)Explain why gross national product is lower than gross domestic product (3mks)

SECTION B (Answer ant THREE questions)
2. Discuss the monetary instruments used by central bank to regulate money supply in the economy.Examine the limitations affecting their successful operations.(15mks)

3.Explain the factors influencing consumption function (15mks)

4.Explain the causes of the persistent inflation phenomena in Kenya (15mks)

5.Examine the ability of commercial banks to create credit.In your own opinion discuss their limitations.(15mks)

6. (a) Discuss the reasons why people desire to hold money.(7mks)
(b) Explain the role of money in development process (8mks)

Bhr 105: Introduction To Macroeconomics Question Paper

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