IEcoS (Economic Services) Economics Paper-2: Questions 60 - 67 of 82

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Question number: 60

» Economic Thought » Keynesian and Monetarist Schools of Thought

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Appeared in Year: 2016

Essay Question▾

Describe in Detail

What are the basic characteristics of monetarist school of thought?

Explanation

The monetarist school is generally associated with American economist Milton Friedman. This school maintains that the money supply is the key determinant on the demand side of short run economic activity.

  • Monetarist economists believe that the role of government is to control inflation by controlling the money supply.

  • Monetarists believe t

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Question number: 61

» Economic Growth and Development » Theories of Growth » Neo Classical Approach Robinson, Solow, Kaldor and Harrod Domar

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Appeared in Year: 2016

Essay Question▾

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What is a well behaved production function? Explain its role in the neo classical growth theory.

Explanation

  • According to Solow, the Harrod Domar model is based on unrealistic assumptions.

    • This model gives knife edge equilibrium problem because its key parameters like saving ratio, capital output ratio and capital labour ratio, if slide slightly either on either side, the result would be either growing unemployment or chronic inflation.

    • Accord

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Question number: 62

» Financial and Capital Market » Financial and Capital Market » Stock Market

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Appeared in Year: 2010

Essay Question▾

Describe in Detail

Explain the concept capital market efficiency and its types?

Explanation

Efficient Market Hypothesis is based on the belief that current market price is a true reflection of the value of the securities (stocks) and it is thus useless to expect that fundamental or technical analysis will yield a superior return by identifying under-priced or over-priced stocks. Under efficient market hypothesis, investors can expect a

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Question number: 63

» Economic Growth and Development » Theories of Growth » Neo Classical Approach Robinson, Solow, Kaldor and Harrod Domar

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Appeared in Year: 2016

Essay Question▾

Describe in Detail

Explain Caldor’s technical progress function.

Explanation

  • The technical progress function presents the functional relationship between growth rate of output per worker and growth rate of capital per worker. According to Kaldor, most technical innovations which result in increased labour productivity require more elaborate equipment or more mechanical power or both involving use of more capital per worke

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Question number: 64

» Economic Growth and Development » Concepts of Economic Growth and Development and Their Measurement

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Appeared in Year: 2017

Essay Question▾

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Explain the role of financial sector especially commercial banks in modem economic development.

Explanation

  • Capital formation: Banks promote capital formation, which is an important determinant of economic development.

    • Capital formation has three well-defined stages: generation of saving, mobilization of saving and canalization of saving in productive uses.

    • Banks play a crucial role in all these stages. They stimulate savings by producing a n

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Question number: 65

» Theory of Employment, Output, Inflation, Money and Finance » The Inflationary Gap » Philip's Curve and Its Policy Implication

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Appeared in Year: 2015

Essay Question▾

Describe in Detail

The following functions are estimated for an economy:

Consumption Function:

Investment Function:

Government Purchases:

Real demand for money:

Real money supply:

Now Estimate the equation for the IS curve and the LM curve. Also find out the equation of AD curve. Find equilibrium values of P, r, C and I.

Explanation

a) Is equation

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Question number: 66

» Economic Growth and Development » Characteristics of Less Developed Countries

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Appeared in Year: 2015

Essay Question▾

Describe in Detail

Differentiate between primary poverty and secondary poverty.

Explanation

  • Primary poverty is defined as a situation where income is insufficient to meet basic needs even if money is spent wisely. For example, if a family earns $2 per day but requires at least $6 to get all the basic necessities like food, water, medicine. Now even if they spend $2 on food still they may not be able to afford other necessities like medi

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Question number: 67

» Economic Growth and Development » Theories of Growth » Neo Classical Approach Robinson, Solow, Kaldor and Harrod Domar

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Appeared in Year: 2010

Essay Question▾

Describe in Detail

“Domar assigned a key role to Investment in the process of Economic Growth. ” Explain Domar’s model of economic growth.

Explanation

Domar Model

According to Domar, investment has Turin effects:

a) Income generating effect through multiplier.

b) Productivity effect by creating productive capacity.

This model further stresses that long utilization of capital inhabits investment and reduces income. Reduction of income brings about deficiency of demand and this results in unem

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