1. The financial system of a country is equated to the brain of a nation which if it malfunctions the consequences are enormous.

(a) Discuss this statement citing any malfunctions that have led to consequences that have negatively affected the Kenyan economy. (6 marks)

(b) Discuss the challenges the system has been facing and suggest measures to be put in place to overcome challenges (4 marks)

2. Microfinance institutions are the solution to poverty alleviation.

a. Discuss this statement citing the role the MFIs have played in achieving this. (5 Marks)

b. Discuss the challenges MFI institutions face and suggest what should be done to correct the challenges. (5 marks)