We have the BBS 2nd Year Macroeconomics Important Questions Answers in PDF.
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BBS 2nd Year Macroeconomics Important Questions Answers in PDF
Following are the BBS 2nd Year Macroeconomics Important Questions Answers:
CHAPTER 1: INTRODUCTION TO MACROECONOMICS
Economics is the study of how individuals and societies choose to utilize scarce resources to satisfy unlimited human wants. Modern economists have divided the whole economic theories into two parts: microeconomics and macroeconomics. Microeconomics studies the economic behaviour of individual decision makers, such as a consumer, a worker, a firm, or a manager. Macroeconomics is the study of very large economy-wide aggregate variables like national income, money, price level, unemployment, economic growth rate, etc.
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SCOPE OF MACROECONOMICS
1. Theory of national income
2. Theory of employment
3. Theory of money
4. Theory of general price level
5. Theory of economic growth
6. Theory of international trade.
USE OR IMPORTANCE OF MACROECONOMICS
1. Helpful to understand the functioning of the economy
2. Helpful in formulating economic policies
3. Helpful in controlling economic fluctuations
4. Helpful in international comparisons
5. Evaluate the performance of the economy
6. To develop and expand microeconomics
7. Helpful to understand international trade
8. Useful in business decision-making
LIMITATIONS OF MACROECONOMICS
1. Dependence on individual units
2. Heterogeneous units
3. The composition of structure of the aggregate is more important than the aggregate itself
4. Different effects of aggregates
5. Limited application
6. It ignores the contribution of individual units.
MACROECONOMIC CONCEPTS
Stock and Flow Variables
1. Stock variables: The macroeconomic variables which are measured at a point of time are called stock variables. In other words, stock variables are the macroeconomic quantities measurable at a specified point in time.
2. Flow variables: The macroeconomic variables which are measured or expressed per unit of time are called flow variables.
Equilibrium and Disequilibrium
1. Equilibrium: In economics, equilibrium refers to a state or situation in which opposite forces, e.g., demand and supply are in balance and there is no tendency of change over time. In macroeconomics, an economy is said to be in equilibrium when aggregate demand equals aggregate supply.
2. Disequilibrium: Disequilibrium refers to the situation in which opposite forces (e.g. aggregate demand and aggregate supply) are in imbalance. In other words, in macroeconomics, disequilibrium refers to a situation in which aggregate demand and aggregate supply are not equal.
Static and Dynamic Equilibrium Analysis
1. Static equilibrium analysis: Static equilibrium analysis explains the final position of equilibrium of the whole economy at a particular point of time.
2. Comparative static equilibrium analysis: Comparative static equilibrium analysis is concerned with a comparative study of different equilibrium positions attained by the economy as a result of change in macroeconomic variables.
3. Dynamic equilibrium analysis: Dynamic equilibrium analysis is the study of the process by which the economy moves from one equilibrium point to another as a result of change in macroeconomic variables.
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a. BBS 2nd Year All subjects Notes.
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c. TU BBS 2nd year Syllabus & subjects.
d. BBS 2nd Year Partail Exam Routine of 2082.
CHAPTER 2 NATIONAL INCOME ACCOUNTING
CIRCULAR FLOW OF INCOME AND EXPENDITURE
Circular flow of income and expenditure is the integrated flow of resources and goods and services among different sector of the economy. To illustrate the circular flow of income and expenditure, economy is divided into two sector, three sector and four sector.
MEANING AND DEFINITION OF NATIONAL INCOME
National income refers to the sum of income earned by all individuals of a nation in a particular period. In other words, it is the market value of all final goods and services produced in an economy during a year. National income data reveal the total economic performance of the economy as a whole. VARIOUS CONCEPTS OF
CHAPTER 3: CLASSICAL THEORY OF EMPLOYMENT
MEANING OF UNEMPLOYMENT
Unemployment is defined as the non-availability of jobs (work) for people able and willing to work at the existing wage rate. It is a most important problem for both developed and developing countries. It creates problems like poverty, inequality, robbery, prostitution. theft, crime, etc.
TYPES OF UNEMPLOYMENT
1. Open unemployment
2. Underemployment
3. Disguised unemployment
4. Cyclical unemployment.
5. Seasonal unemployment
6. Frictional unemployment
7. Structural unemployment
8. Educated unemployment
SAY’S LAW OF MARKET
Say’s law of market is the foundation of classical economics. This law has been named for the French economist J.B. Say, a famous economist of 19th century. The theory of full employment of classical economists is based on J.B. Say’s law of market. According to him. “Supply creates its own demand”. It means that production of goods will create demand for them also.
IMPLICATIONS OF SAY’S LAW OF MARKET
1. Self-adjusting economy
2. No general overproduction
3. No general unemployment
4. Flexible wages create full employment
5. Policy implication
CRITICISMS OF SAY’S LAW OF MARKET
1. Supply does not create its own demand
2. Money is demanded for other purpose
3. Economy is not self-adjusting
CLASSICAL THEORY OF INCOME AND EMPLOYMENT
The classical theory of employment is based on the assumption of full employment of labour and other resources of the economy. The classical economists believed in the stable equilibrium at full employment level as a normal situation. If there is not full employment in the actual life, then there is always a tendency towards full employment. Less than full. employment is an abnormal situation, which will disappear in the long run through the automatic mechanism of the economic system. The working of self-regulating mechanism under the classical system can be understood in the three markets of the economy: Labour market. Product market and Money market. But, this theory has been severely criticized by Keynes. According to him, full employment is not possible in the any economy. He also regarded this theory as impractical and little relevance with real world
CRITICISMS OF CLASSICAL THEORY OF EMPLOYMENT
1. Under-employment Equilibrium
2. Supply does not create its own Demand
3. No automatic Adjustment
4. Government Intervention
5. Role of Money
6. Saving-Investment Equality
7. Long-run Analysis
8. Assumption of Perfect Competition
9. Not a General Theory
10. Not a Practical Theory
Henc, these are the BBS 2nd Year Macroeconomics Important Questions Answers in PDF.
