—_— oo @ MIDLANDS STATE UNIVERSITY SB FACULTY OF BUSINESS SCIENCES DEPARTMENT OF ECONOMIC SCIENCES ADVANCED INTERNATIONAL ECONOMICS: MECO737 SESSIONAL EXAMINATIONS NOVEMBER/ DECEMBER 2021 DURATION: 3 HOURS EE REQUIREMENTS None INSTRUCTIONS TO CANDIDATES ‘Answer any Four Questions pS Page 1of2Question 1 sing the specific factors model, show how a change in the price of manufactured products may ffect wages. (25 Marks) ‘Question 2 Examine any three theories of foreign direct investment showing how each may be supetios vc! others. (25 Marks) Question 3 While Kennen’s model of optimum currency union is based on product diversification, MeKinnon’s model is based on openness of countries. Critically examine these (0 models showing which of the two is likely tobe superior in the current economic environments, (5 Marks) Question 4 ‘a. Using the simple monetary model, show how exchange rates are determined given @ floating exchange rate regime. (10 Marks) bb. Examine how realistic this model is in today's world. (15 Marks) Question 5 “When labor productivity increases, the number of investing locations increases”. Evaluate this statement in the context of labour productivity as a heterogeneous factor of firm location. (25 Marks) E iD Page 2 of 2