Kindly address all questions clearly explaining your answers.

1.Compare and contrast the Keynesian economics and supply side economics

2.

The effectiveness of a tablet containing x mg of drug I and x2 mg of drug 2 was being tested. In trials the following results were obtained: % effectiveness, y 92.5 50.9 20.8 94.9 54.1 16.9 89.3 47.3 25.2 94.1 45.1 49.7 98.9 37.6 95.2 [y = 469.7 [x, =235 x2 =207.8 Ex =11,202.68 x =12,886.42 [ yx, = 22,028.78 [ yx2 = 19,870.22 xx2 =8,985.96 (i) Using the multiple linear least square regression model: y = a + By+ Bizte (a) Show that the least squares estimates of o . , and B2 satisfy: [ xi = na + $,Ex + B2X x 12 (b) Hence, using the above data, find their numerical values. [7] (ii) Predict the percentage effectiveness for a tablet containing 51.3 mg of drug x and 18.3 mg of drug X2 . [2] [Total 9]A life insurance company sells 5-year-term, single-premium, unit-linked bonds each for a premium of f10,000. There is no bid/offer spread and the allocation percentage is 100%. (i) Assuming that the only charge is a 2% annual management charge and assuming unit growth of 9% pa, calculate the unit reserve at the start and end of each year and the management charge each year. [3] (ii) Calculate the net present value of the contract assuming: Commission of 5% of the premium Initial expenses of $50 Annual renewal expenses of $20 in the Ist year, inflating at 5% pa. Independent rate of mortality is a constant 0.5% Independent rate of surrender is 5% pa Non unit fund interest rate is 9% pa Risk discount rate 12% pa The company holds unit reserves equal to the full value of the units and zero non-unit reserves. You may assume that expenses are incurred at the start of the year and that death and surrender payments are made at the end of the year. [4] [Total 7]