Program: -PGDM RM (Batch 2012-14), II Trim, End Semester Exam paper, Subject: Macroeconomics

K. J. SOMAIYA INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH

Program: PGDM (RM), II Trim (Batch 2012-14)

Subject: Macro Economics

(End Trimester examination)

Maximum Marks: 30
Duration: 3 hours
Date: 23rd Jan, 2013.

QUESTION 1: SHORT NOTES ON THE FOLLOWING (ANY FOUR) (3*4=20 MARKS)

1. What is monetary policy? Which all the instruments of Monetary policy?

2. Explain the different types of Inflation based on its degree and source.
3. What are the instruments of fiscal policy? What are the difference between
automatic stabilizer and discretionary fiscal policy?
4. Fixed and Flexible Exchange Rates. What is the effect of depreciation on Balance
of Trade, explain with the Concept of ‘J’ Curve.

5. Explain the relationship between inflation and unemployment with the help of Philips
curve.
QUESTION 2 SHORT ESSAY (ANY ONE) (10 MARKS)

1. Explain the relationship of goods and money market in the functioning of an economy
with ISLM framework. Explain how monetary policy can complement expansionary
fiscal policy without leading to ‘crowding out’ problem.

2. Explain Quantity Theory of Money in detail.

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