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Econ 325 Economic Policy Analysis - Kabarak University

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30 views4 pages

Econ 325 Economic Policy Analysis - Kabarak University

Uploaded by

11803098dan
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© © All Rights Reserved
Available Formats
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KABARAK UNIVERSITY

UNIVERSITY EXAMINATIONS
MAIN CAMPUS
SECOND SEMESTER, 2018/2019 ACADEMIC YEAR

EXAMINATION FOR THE DEGREE OF BACHELOR


OF SCIENCE IN ECONOMICS AND MATHEMATICS
ECON 325: ECONOMIC POLICY ANALYSIS
STREAM: Y3S2 TIME:
2.00-4.00 PM
EXAMINATION SESSION: JAN-APRIL 2019
DATE: 01/04/2019

Instructions
1. Question one is compulsory and carries 30 marks
2. Attempt any other two questions
3. Clear and unambiguous answers are encouraged

QUESTION ONE
a) Explain the following concepts:
i) Climate change and environmental degradation (2
marks)
ii) Productive efficiency and technical efficiency (2 marks)
iii) Policy evaluation and policy implementation (2 marks)
iv) Pareto optimality and Pareto efficiency (2 marks)
v) Centralization and decentralization (2 marks)

b) “African countries, including Kenya, continue to face food deficits. This is


due to bad policies, wrong priorities and other internal problems; not
because of unfavorable climate and/or policies designed by the developed
countries”. Use appropriate examples to evaluate the above statement
(12
marks)
c) Most developing countries such as Kenya have apparently sound economic
policies to address most of the macroeconomic challenges facing them.
However, these countries continue to experience persistent
underdevelopment. What factors contribute to this apparent
contradiction? (8 marks)

QUESTION TWO

In the last few years, Kenyans have witnessed cases of grand corruption in
government.
a) What are some of the causes of corruption? (5 marks)
b) What are the macroeconomic consequences of corruption in
Kenya? (5 marks)
c) What policies has the Government of Kenya put in place to contain
corruption?
(5 marks)
d) Have these policies worked or failed? Explain your answer (5
marks)

QUESTION THREE

It has been noted that political leaders in Africa never fail to blame the developed
countries for all the socio-economic problems facing the continent; including
poverty, diseases and balance of payments deficits, among others.
With respect to the operations of Multinational Corporations (MNCs) in Africa,
should we also blame the developed countries? Use relevant examples to explain
your answer. (20 marks)
QUESTION FOUR
a) Explain the relation between the macroeconomic challenges of poverty,
unemployment and inequality (10
marks)
b) Provide policy solutions to these macroeconomic challenges (10
marks)
QUESTION FIVE
Classical Economists argued that there was no need for government intervention
in the market due to the self-equilibrating nature of markets. On the other hand,
Keynesian Economists argued that since the market failed to play self-
equilibrating role as evidenced by the Great Depression it was necessary for the
government to intervene in the market.
a) Discuss both the Classical and Keynesian theories (10
marks)
b) Which of the theories in (a) above is more relevant to developing countries
such as Kenya?
Explain your answer (10 marks)

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