NMIMS University 2008-1st Sem Diploma Business Administration - - Economic Environment for Banking - Question Paper
SVKMs NMIMS University
School of Distance Learning
Economic Environment for Banking
Date: 5.6.2008 Marks: 100
Time: 11.00 am to 2.00 pm
Instructions:
1) The question paper consists of three parts A, B & C
2) Answer the questions in each part as directed.
3) Figures in brackets in the margin indicate full marks.
Part A Basic Concepts
Answer any Five of the following questions (5 x 12 = 60 Marks)
1. What do you understand by Price Index? Explain the following :
a. Consumer Price Index (CPI)
b. Wholesale Price Index (WPI)
c. GDP Deflator
2. What are the components of Money Supply? Explain the concept of Money Multiplier with an example. Describe the component and sources of M3 and Bank Finance.
3. What do you understand by Fiscal Deficit? What is the trend of Fiscal Deficit in India after economic reforms? What is the impact of Fiscal Deficit in the economy? What, according to you, is the long term solution to fiscal deficit in India?
4. a) What do you understand by the concept Universal Banking? What is the trend of growth
of Universal Banking across countries? b) The RBI Discussion Paper of 1998 addressed to three issues relating to FIsmovement towards Universal Banking. State the issues involved and explain the RBI approach in
this regard?
5. What according to you are the reasons for the spiraling inflation in India? What are the policy choices before the Govt, of India to contain inflation? Should the emphasis be over whelming on fiscal measures? Is there a case for greater Govt, intervention in fiscal/ commodities market?
6. What do you understand by Balance of Payment? What are its three major divisions? What is meant by Balance of Payment deficit or surplus? Explain the position of India in this regard.
7. What is meant by convertibility of currency? Is India ready for Full Convertibility of Rupee?Give reasons for your answer/
8. a) Discuss the four generic forms of Entiy available for new firms wanting to enter an industry, b) Discuss Analysis of Competitive Rivalary using Porters Five Forces Model
Economic Environment for Banking
Date: 5.6.2008 Marks: 100
Time: 11.00 am to 2.00 pm,
Instructions:
1) The question paper consists of three parts A, B & C
2) Answer the questions in each part as directed.
3) Figures in brackets in the margin indicate full marks.
Part A Basic Concepts
Answer any Five of the following questions (5 x 12 = 60 Marks)
1. What do you understand by Price Index? Explain the following :
a. Consumer Price Index (CPI)
b. Wholesale Price Index (WPI)
c. GDP Deflator
2. What are the components of Money Supply? Explain the concept of Money Multiplier with an example. Describe the component and sources of M3 and Bank Finance.
3. What do you understand by Fiscal Deficit? What is the trend of Fiscal Deficit in India after economic reforms? What is the impact of Fiscal Deficit in the economy? What, according to you, is the long term solution to fiscal deficit in India?
4. a) What do you understand by the concept Universal Banking? What is the trend of growth
of Universal Banking across countries? b) The RBI Discussion Paper of 1998 addressed to three issues relating to FIsmovement towards Universal Banking. State the issues involved and explain the RBI approach in
this regard?
5. What according to you are the reasons for the spiraling inflation in India? What are the policy choices before the Govt, of India to contain inflation? Should the emphasis be over whelming on fiscal measures? Is there a case for greater Govt, intervention in fiscal/ commodities market?
6. What do you understand by Balance of Payment? What are its three major divisions? What is meant by Balance of Payment deficit or surplus? Explain the position of India in this regard.
7. What is meant by convertibility of currency? Is India ready for Full Convertibility of Rupee?Give reasons for your answer/
8. a) Discuss the four generic forms of Entry available for new firms wanting to enter an industry,
b) Discuss Analysis of Competitive Rivalary using Porters Five Forces Model
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Part B : Problem Testing, Conceptual understanding | ||||||||||||||||||
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10. From the following Balance of payments statement, calculate (5+5 marks) a. Net current account balance _b. Change in forex reserves__ | ||||||||||||||
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Part C : Case study |
11. Read the following case carefully.
In the twilight of Doha
Jul 27th 2006| WASHINGTON,DC
From The Economist print edition
The global trade talks have collapsed because the worlds biggest economies prefer failure to compromise. What comes next?
AT LAST it is official. After stumbling on for months, the Doha trade talks have collapsed. On July 24th, at the end of yet another futile gathering of trade ministers in Geneva, Pascal Lamy, the World Trade Organizations director general, formally suspended the negotiations. He set no date for their resumption. As Kamal Nath, Indias trade minister put it, the Doha round is definitely between intensive care and the crematiorium
Launched in the Quatari capital in 2001, soon after the terrorist attacks on New York and Washington, DC, the Doha round was to be an ambitious effort to make globalization more inclusive and help the worlds poor, particularly by slashing barriers and subsidies in farming, the rich-worlds most molly-coddled industry.
For almost five years, negotiatiors haggled over just what such an ambitious effort should look like- and made scant progress. Technically there was nothing inevitable about this weeks collapse. Yet, despite their grand rhetoric, the worlds big economies have long appeared unwilling to make the political compromises that a Doha deal requires.
Judging whether Geneva 2006 is a replay of Brussels 1990 means answering two questions: why will todays negotiators not compromise? And what, if anything, could change their mind?
The fault lines in the Doha round are deep. America wants to slash tariffs, arguing (rightly) that the best way to help poor countries is through more open markets. Since Americas tariffs are already low, that puts the onus on the European Union (EU) to cut farm tariffs and on big emerging economies to reduce barriers on farm goods and industrial products. Emerging economies, in contrast, want fewer farm subsidies and lower tariffs in rich countries, but are loth to reduce their own barriers much. Countries such as India argue that in a pro-poor Doha round they need do tittle. The EU chides America both for demanding unrealistically large tariff cuts from others and for offering too little farm-subsidy reform of its own.
In principle, a compromise was there for the taking. Indeed, Mr Lamy has informally laid out its contours: more subsidy cuts than America has offered and more ambitious tariff cuts by the EU and big emerging economies. So why has nothing happened? One reason is genuine differences over whether the interests of poor people are best served by lower tariffs or more special protection. But the explanation lies chiefly in the failure of countries to face down their own powerful protectionist lobbies, particularly farmers.
Question: (20 marks)
It is a universally accepted fact that trade enhances consumption and production possibilities and leads to higher prosperity levels. Why then all countries of the world restrict trade? Discuss the reasons behind failure of Doha trade talks.
For almost five years, negotiatiors haggled over just what such an ambitious effort should look like- and made scant progress. Technically there was nothing inevitable about this weeks collapse. Yet, despite their grand rhetoric, the worlds big economies have long appeared unwilling to make the political compromises that a Doha deal requires.
Judging whether Geneva 2006 is a replay of Brussels 1990 means answering two questions: why will todays negotiators not compromise? And what, if anything, could change their mind?
The fault lines in the Doha round are deep. America wants to slash tariffs, arguing (rightly) that the best way to help poor countries is through more open markets. Since Americas tariffs are already low, that puts the onus on the European Union (EU) to cut farm tariffs and on big emerging economies to reduce barriers on farm goods and industrial products. Emerging economies, in contrast, want fewer farm subsidies and lower tariffs in rich countries, but are loth to reduce their own barriers much. Countries such as India argue that in a pro-poor Doha round they need do little. The EU chides America both for demanding unrealistically large tariff cuts from others and for offering too little farm-subsidy reform of its own.
In principle, a compromise was there for the taking. Indeed, Mr Lamy has informally laid out its contours: more subsidy cuts than America has offered and more ambitious tariff cuts by the EU and big emerging economies. So why has nothing happened? One reason is genuine differences over whether the interests of poor people are best served by lower tariffs or more special protection. But the explanation lies chiefly in the failure of countries to face down their own powerful protectionist lobbies, particularly farmers.
Question: (20 marks)
It is a universally accepted fact that trade enhances consumption and production possibilities and leads to higher prosperity levels. Why then all countries of the world restrict trade? Discuss the reasons behind failure of Doha trade talks.
END OF QUESTION PAPER
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