Final Term Paper Current ECO401 Economics 17 August 2010

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my eco401 ppr today. 80% mcq,s were from current n previous ppr. subjective portion is as follows:-

• How a central bank controls functions of commercial banks? 3marks
  
• it is argued that devaluation has negative impacts on the country,s economy , can it be used to solve POB prbs? 3marks
  
• why the slope of consumption function is less than one? & name some macroecnomic variables which determine the national income of a country. 2+3 marks
  
• what are the conditions under which foreign exchange markets exists, give examples 5 marks
  
• what are principles of taxation? 5 marks
  

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It is said that growth is an important macroeconomic issue. Why? Discuss. 3
Explain the money demand curve with the help of diagram? 3
If y = Y / L, where, Y = Total GDP, L = Population, y = per capita GDP then prove that Growth rate of per capita income = Growth rate of total output - Growth rate of population. 5
Discuss the equilibrium in money market and explain with the help of diagram? 5
If government increases spending e.g., increases the wages of government servants, how it will affect the consumption, production and hiring of new employees? 5