History Of Economic Thought Question Paper

History Of Economic Thought

Course:Bachelor Of Education

Institution: Kenyatta University question papers

Exam Year:2010

KENYATTA UNIVERSITY
UNIVERSITY EXAMINATIONS 2009/2010
SECOND SEMESTER EXAMINATION FOR THE DEGREE OF BACHELOR OF ARTS AND BACHELOR OF EDUCATION
AEC 406: HISTORY OF ECONOMIC THOUGHT
DATE: Friday, 9th April, 2010 TIME: 11.00 a.m. – 1.00 p.m.
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INSTRUCTIONS:
1. Question ONE is compulsory (30 marks)
2. Answer any other TWO (2) questions (20 marks each)

Question One
When Kenya adopted the important substitution strategy for industrial development in 1965, the government advanced the infant industry argument to justify the self-reliance objective, and the protectionist policies that it adopted. Discuss this statement in relation to the fact that during the pre-liberalization period (before 1992) Kenya’s trade policies and practices were very similar to those of mercantilists (30 marks)

Question Two
a)“The classical economic school of thought owes a lot of its basic principles to the
short-lived school of physiocracy”. Discuss this statement (10 marks)

b) Jean Baptise Say’s contribution to the theory of value was an improvement on
Adam Smith’s second theory of value. Discuss this statement. (10 marks)

Question Three
a) State Thomas Malthus’s law of population and show how it is more relevant to Kenya today than it is to his home country Britain. (10 marks)

b) John Keynes’s theory of market failure was an improvement of Thomas Malthus theory of deficiency in effective demand. Discuss this statement (10 marks)

Question Four
a) Briefly outline Karl Marx’s critique of the classical system and show why his prediction that the capitalist system was doomed to collapse did not materialize
(14 marks)

b) Highlight three of Karl Marx’s predictions which have been actualized
(6 marks)

Question Five
a) List the three laws of Herman Gossen which contributed to the emergence of the economic concept of marginal utility (6 marks)

b) How did William Jevon’s refinement of the theory of marginal utility solve the riddle of diamonds being more valuable than water (8 marks)

c) How did Carl Menger’s theory of utility demolish the classical economists’ contention that the value of a good was derived from its past labour (machines) and present labour cost of production (6 marks)

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