LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034
B.A. DEGREE EXAMINATION – ECONOMICS
FIFTH SEMESTER – NOVEMBER 2010
EC 5504 – MACRO ECONOMICS – II
Date : 29-10-10 Dept. No. Max. : 100 Marks
Time : 9:00 – 12:00
PART – A (5 x 4 = 20 marks)
Answer any FIVE of the following each answer not exceeding more than 75 words:
- Define the concept Absolute Income Hypothesis.
- What is meant by ratchet effect of Duesenberry?
- Define Acceleration.
- “The value of the multiplier is the reciprocal of the MPS” – Explain
- Define inflation.
- What is Knife-edge balance?
- What are the instruments of monetary policy?
PART – B (4 x 10 = 40 marks)
Answer any FOUR of the following each answer not exceeding more than 300 words:
- Examine the main elements of Keynes’ absolute income theory. What are the improvements made by Dusenberry upon it?
- “The trade cycle is a purely monetary Phenomenon” – Examine
- Explain over investment theory of Von Hayek in analysing the trade cycle.
- Elucidate and distinguish between Demand – Pull and Cost Push inflation.
- What are the determinants of general price level?
- Briefly explain the Harrod – Domar model of growth.
- Write a short note on Monetary Policy in maintaining economic growth.
PART – C (2 x 20 = 40 marks)
Answer any TWO of the following each answer not exceeding more than 900 words:
- Describe critically Milton Friedman’s Permanent income theory.
- What are the main similarities and differences between the multiplier accelerator interaction models of Hicks and Samuelson?
- Explain the statement that Kaldor attempts to provide a framework for relating the genesis of technical progress to capital accumulation in his model of growth.
- Discuss the role of Fiscal Policy in a developing economy?
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