Download Autumn Repeat Exams 2010/2011: Macroeconomics Principles - NUI Galway and more Exams Macroeconomics in PDF only on Docsity!
Ollscoil na hÉireann, Gaillimh GX_____
National University of Ireland, Galway
Autumn Repeat Examinations 2010/
Exam Code(s) 1BF Exam(s) 1 st^ B.I.S. Module Code(s) EC1 41 Module(s) Principles of Macroeconomics Paper No. 1 Repeat Paper External Examiner(s) Dr. Pat McGregor Internal Examiner(s) Professor John McHale Professor Terrence McDonough
Duration 2 hours
No. of Pages 6 Discipline Economics Course Co‐ordinator(s) Gerard Turley, Terrence McDonough Requirements : MCQ Release to library : Yes Handout Statistical Tables Graph Paper Log Graph Paper
Answer any TWO questions. Please answer all parts 1 a. Briefly state why the Marxian world view is consistent with radical political policy. (15 marks) b. 1. Draw a picture illustrating the Marxian theory of the business cycle. List the factors the change in the upturn along with the direction of the change. Do the same for the downturn.(15 marks)
- What causes the business cycle in this theory? (10 marks) 3 What would be the effect of separating the investment decision from the level of profitability?(10 marks)
- a. Explain the Marxian theory of structural inflation.(22 marks) b. Draw a graph showing the equilibrium interest rate in the money market. (10 marks) c. Explain why borrowing for financial investment is risky?(10 marks) d. Identify four externalities in the auto industry. (8 marks)
- a. 1. Illustrate the Keynesian explanation of inflation with a diagram showing the Aggregate Expenditure line, the 45 degree line and a line identifying full employment GDP. (16 marks)
- What options does the government have according to this analysis in addressing the problem?(18 marks) b. C = 10 0 + .8GDP I = 300 G = 150 X = 50 M = .05GDP i) Calculate the equilibrium level of income for this model. (4 marks) ii) If investment doubles what is the new equilibrium income level? (4 marks) iii) Calculate the multiplier for this model. (4 marks) iv)To achieve full employment GDP at 2600, to what level should government expenditure be raised? (4 marks)
