COLLEGE OF 

REDEEI TIER'S Ii NIVERSITY 
[ de, Osun State 

MANAGEMENT AND SOCIAL SCIENCES 

    

DEPARTMENT OF 	ECONOMI CS AND BUSINESS STUDIES 
COURSE CODE /TITLE 	ECO 402/Advanced Macroeconomic Theory II  

Second 	SEMESTER EXAMINATIONS 
SESSION 	  

INSTRUCTIONS ON CHOICE OF QUESTICNS TO BE ANSWERED 	  
Answer question one and any other two questions  

TIME ALLOWED 2 hours 

  

    

    

      

2017/2018 

44 

1. (a) The key equation of the Solo v growth model is divided into two components. With 
the aid of a well labeled diagram. vividly explain these components (20 marks). 

(b) Determine the evolutions of k bum and knowledge in the Solow growth model. 
(4 marks). 

(c) Show that the intensive-form )f the So. ow type of production function, f (k) satisfies 

the following conditions: /0 > 0; f (k) < 0 (6 marks). 
[30 marks] 

2. (a) Assess the major difference (s) betwc en exogenous and endogenous models of 
economic growth (2 marks). 
(b) State the Intuia conditions of the neocl tssical growth model (3 marks). 

(c) Given a production function of the tyr e F(K,AL) = (AL)" , 0< a <I; determine 

its intensive-form (10 marks). 
[15 marks] 

3. (a) Critically assess the key conc, Tts in Aram Smith growth and development model 
(10 marks) 

(b) Examine the agents and processes of g owth in this theory (5 marks). 
[15 marks] 

4. In discussing the contribution of Carl Mar: to the theory of economic development, 
three salient points are often rais, d. Identity and explain these points (10 marks). 
(b) Highlight five weaknesses of this theory (5 marks). 

[15 marks] 

5. (a) Explain the term Liquidity T rap and discuss its effects on the economy (10 marks) 
(b) It is argued that conventions 1 moneta y policy is always ineffective in addressing 
the problem of liquidity trap; su ?,gest othi r measures that can be taken to resolve this 
problem (5 marks) 

[15 marks] 


	Page 1