University of Delhi 2006-2nd Year B.A Economics Micro-: Analysis And Policy -II External Correspondence Year : - Question Paper

part ‘A’

Q. 1. (a) State and discuss Keynes’ Psychological legal regulations of consumption.
(b) explain the factors on which the propensity to consume depends.

Q. 2, (a) Differentiate ranging from autonomous and induced investment.
(b) If autonomous investment in an economy is Rs. 200 Cr. and the consumption function is C = 80 + -.6Y, what will be the equilibrium level of income ?

Q. 3. Evaluate ‘Irving Fisher’s volume Theory of Money’. How does the Keynesian approach differ from Fisher’s approach ?

Q. 4. With the help of outside diagrams distinguish ranging from ‘Demand Pull’ and ‘Cost Push’ inflation. Do you agree that mild inflation is desirable for economic activities ? 15, 5

Q. 5. discuss the subsequent : 10, 10
(a) Leakages of multiplier;
(b) Difficulties of Barter system.

SECTION’B’

Q. 6. explain the functions of a Commercial Bank. How is Commercial Bank various from the Central Bank? 15, 5

Q. 7. discuss the quantitative methods of credit control adopted by the Central Bank. ranging from Bank Rate and Open Market Operations which is more effective instrument of credit control? provide reasons. 15, 5

Q. 8. discuss the causes of growth of public expenditure in a developing country like India. define the effects of public expenditure on production and distribution. 10, 10

Q. 9. explain the different objective of Fiscal Policy in a developing economy. elaborate its limitations ? 15, 5

Q. 10. Write short notes on any 2 of the following: 10,10
(a) Incidence of lump sum tax in monopoly
(b) Merits and demerits of indirect taxes;
© Recommendations of 11th Finance Commission

Earning:   Approval pending.