Question
a)Citingsuitableexamples,distinguishbetweenleakagesandinjectionsasusedin nationalincomestatistics[4Marks] b)ThefollowingdatarelatetotheeconomyofcountryZ.ThefiguresareinbillionKSH Item KSHbillion Totalexpenditureongoodsandservices 450 Purchaseofintermediategoods 110 Imports 50 Exports 40 Governmenttransferpayments 20 Netindirecttaxes 25 Netfactorincomefromabroad -25 Required: Compute; (i)GNPatmarketpriceandatfactorcost (ii)GDPatfactorcost[6Marks] Question3[5Marks] a)Supposeyouaregivenaninducedinvestmentfunctionoftheform:=+.Derive
a)Citingsuitableexamples,distinguishbetween"leakages"and"injections"asusedin
nationalincomestatistics[4Marks]
b)ThefollowingdatarelatetotheeconomyofcountryZ.ThefiguresareinbillionKSH
Item
KSH"billion"
Totalexpenditureongoodsandservices
450
Purchaseofintermediategoods
110
Imports
50
Exports
40
Governmenttransferpayments
20
Netindirecttaxes
25
Netfactorincomefromabroad
-25
Required:
Compute;
(i)GNPatmarketpriceandatfactorcost
(ii)GDPatfactorcost[6Marks]
Question3[5Marks]
a)Supposeyouaregivenaninducedinvestmentfunctionoftheform:=+.Derive
anInvestmentMultiplier(showallyourworkings)
b)Inapropensitytoconsumefunction(oraconsumptionfunction),explainwhybothAPC
andMPCdeclinesasincomeincreases
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