LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034
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B.A. DEGREE EXAMINATION – ECONOMICS
FOURTH SEMESTER – April 2009
EC 4503 – MACRO ECONOMICS – I
Date & Time: 24/04/2009 / 9:00 – 12:00 Dept. No. Max. : 100 Marks
PART –A
Answer any FIVE questions in about 75 words each (5×4=20 marks)
- Define Macro Statics.
- Distinguish between GDP and GNP.
- What do you mean by comparative static analysis?
- What are properties or technical attributes of Consumption Function?
- What do you mean by Induced Investment?
- Define ‘Multiplier’.
- What is Liquidity Trap?
- What do you mean by Effective Demand?
PART – B
Answer any FOUR questions in about 250 words each (4×10=40 marks)
- Explain the Stock and Flow concepts.
- Social Accounting or National Income Accounting is an indicator of health
of the Economy – discuss.
- Higher the marginal propensity to consume, higher will be the value of the
Multiplier – Discuss the Statement.
- Why is MEC expressed as a rate of discounting? How does this concept help
in explaining the investment behavior?
- The interaction of aggregate supply and demand functions determines the
equilibrium level of output and employment – Discuss.
- Derive an IS LM curve – Give their properties.
PART – C
Answer any TWO questions in about 900 words each (2×20=40 marks)
- Discuss the scope of macro economics analysis. What are the limitations of
macro economic analysis?
- Explain the circular flow of income in an economy including the foreign
Sector. Use diagrams to illustrate your answer.
- Keynes Consumption function is an epoch making tool in economics analysis
– Discuss.
- Compare the classical and Keynesian models of income determination and
point out the difference between the two.
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