LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034
B.A. DEGREE EXAMINATION – ECONOMICS
FOURTH SEMESTER – APRIL 2008
EC 4500 – MACRO ECONOMIC THEORY
Date : 26/04/2008 Dept. No. Max. : 100 Marks
Time : 9:00 – 12:00
PART – A
Answer any FIVE questions in about 75 words each. (5 x 4 = 20 marks)
- Distinguish between stocks and flows.
- Define GNP at market price.
- Write a short note on Laissez faire.
- What do you understand by marginal propensity to consume?
- What is liquidity trap?
- What is meant by accelerator?
- How do you classify inflation on the basis of rate of increase in price?
PART – B
Answer any FOUR questions in about 250 words each. (4 x 10 = 40 marks)
- Bring out the scope and importance of macroeconomics.
- Explain the various methods of measuring national income and list out the difficulties involved in measuring national income.
- Elucidate the process of circular flow of income and product in a three-sector closed model.
- Elaborate the Keynesian model of income determination.
- Discuss the concept of “investment multiplier”.
- Briefly explain the various phases of trade cycle.
- Illustrate the derivation of LM curve.
PART – C
Answer any TWO questions in about 900 words each. (2 x 20 = 40 marks)
- Bring out the importance of static, comparative static and dynamic analysis in economics.
- What do you understand by social accounting? How are social accounts arrived? Discuss the importance of social accounting in economic analysis.
- Define inflation. Enumerate the causes for inflation and remedial measures.
- Critically examine the Harrod-Domar models of economic growth.
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