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This particular Assignment references the syllabus chosen for the subject of Economics, for the July 2020 - January 2021 session. The code for the assignment is BECC-134 and it is often used by students who are enrolled in the BAG Degree.
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Answer the following Descriptive Category Questions in about 500 words each. Each question carries 20 marks. Word limit does not apply in the case of numerical questions.
1) Describe the IS-LM model of simultaneous equilibrium in goods and money markets. What do the points outside the IS and LM curves indicate? Use appropriate diagrams to substantiate your answer.
2) Derive AD curve from the IS-LM model. What are the factors that lead to a shift in the AD curve?
Answer the following Middle Category Questions in about 250 words each. Each question carries 10 marks. Word limit does not apply in the case of numerical questions.
3) Distinguish between demand pull and cost push inflation.
4) What is the significance of the traditional Phillips Curve? Why does the shape of the Phillips Curve change when we introduce expectations into our analysis?
5) Explain why there could be a conflict between external and internal balance.
Answer the following Short Category Questions in about 100 words each. Each question carries 6 marks.
6) Give a brief account of the factors lead to a shift in the aggregate supply curve.
7) Distinguish between nominal exchange rate and real exchange rate.
8) Explain the concept of stagflation.
9) In the IS-LM model, explain why the economy always moves towards the equilibrium point.
10) State the difference between absolute PPP and relative PPP.
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