General Economics (Paper II) 2016 Question Paper

Notes 5 Pages

Indian Statistical Service

General Economics

Contributed by

Mohanlal Sant

Serial No.
5801
A-GSE-P-FDB
GENERAL ECONOMICS
Paper— II
Time Allowed: Three Hours Maximum Marks : 200
INSTRUCTIONS
Please read each of the following instructions carefully
before attempting questions :
There are FOURTEEN questions divided under
THREE Sections.
The ONLY question in Section A is compulsory.
In Section B, SIX out o f SEVEN questions are to be
attempted.
In Section C, FOUR out of SIX questions are to be attempted.
Candidates should attempt questions/parts as per the
instructions given in the Section.
The number of marks carried by a question/part is indicated
against it.
Ail parts and sub-parts o f a question are to be attempted
together in the answer book.
Attempts of questions shall be counted in sequential order.
Unless struck off attempt o f a question shall be counted even
if attempted partly.
Any page or portion o f the page left blank in the answer
book must be clearly struck off.
Candidates are required to write clear, legible and concise
answers and to adhere to word limits wherever indicated.
Failure to adhere to word limits may be penalized.
Answers must be written in ENGLISH only.
Page 1
Serial No.
5801
A-GSE-P-FDB
GENERAL ECONOMICS
Paper— II
Time Allowed: Three Hours Maximum Marks : 200
INSTRUCTIONS
Please read each of the following instructions carefully
before attempting questions :
There are FOURTEEN questions divided under
THREE Sections.
The ONLY question in Section A is compulsory.
In Section B, SIX out o f SEVEN questions are to be
attempted.
In Section C, FOUR out of SIX questions are to be attempted.
Candidates should attempt questions/parts as per the
instructions given in the Section.
The number of marks carried by a question/part is indicated
against it.
Ail parts and sub-parts o f a question are to be attempted
together in the answer book.
Attempts of questions shall be counted in sequential order.
Unless struck off attempt o f a question shall be counted even
if attempted partly.
Any page or portion o f the page left blank in the answer
book must be clearly struck off.
Candidates are required to write clear, legible and concise
answers and to adhere to word limits wherever indicated.
Failure to adhere to word limits may be penalized.
Answers must be written in ENGLISH only.
Page 2
SECTION—A
(The only question in this Section is com pulsory)^
1. Answer the following questions in about 100 words
each : 6X5=30
(a) What are the basic characteristics of the monetarist
school of thought ? 5
(b) What is Marxian Theory of Alienation ? 5
(c) Explain K aldors technical progress function. 5
(d) What is GDP deflator ? How is it used to measure
inflation ? 5
(e) Describe Quesnay’s Tableau Economique. What
effect did it have on modern economic thought ?
5
(f) Distinguish between inside money and outside
money. 5
SECTION— B
(Answer any SIX out of the following SEVEN questions
in about 200 words each) : 15x6=90
2. What is a ‘well-behaved’ production function ? Explain
its role in neo-classical theory of growth. 15
3. Explain the inevitability of Stationary state in the
Classical theory of growth. 15
2 (Contd.)
Page 3
Explain and derive foreign trade multiplier with foreign
repercussions. 15
Distinguish between autonomous and accommodating
transactions. What role do the accomm odating
transactions play in balance of payments ? 15
“The need for balanced growth rests on the need for a
balanced diet.”—Nurkse. Explain this statement. 15
Explain the value added method of national income
accounting. Illustrate the calculation of national income
of a hypothetical closed economy with no government
sector. 15
How does inflation redistribute wealth from creditors
to debtors ? Under what circumstances can wealth ever
be redistributed from debtors to creditors ? 15
SECTION— C
(Answer any FOUR out of the following SIX questions
in about 300 words each) : 20><4=80
Critically examine the steady-state equilibrium growth
paths of the Swan-Solow and Harrod-Domar models.
What is the role of State in correcting disequilibrium
in these models ? 20
3
e
(Contd.)
Page 4
10. Derive the simultaneous equilibrium of the product and
money markets in a closed economy. Show how ®
expansionary monetary policy changes the equilibrium
situation. 20
11. Explain how the presence of Non Banking Financial
Intermediaries (NBFI) make monetary policy ineffective.
Suggest some measures to solve the problem. 20
12. Explain the Ranis-Fei model of economic development.
How does it improve upon the Lewis model of
development ? 20
13. The globalisation of capital markets has resulted in
volatile and unrealistic exchange rates, unstable financial
conditions and decline in effectiveness of governments’
domestic monetary policy. Explain this phenomenon
and suggest suitable measures. 20
14. “The best strategy of development is the creation of
imbalances.” Discuss the statement in the light of Indian
experience. 20
Page 5