QUESTION 1 (20 MARKS) a) There are two categories of government expenditure namely operating expenditures and development expenditures. Discuss the components of the government development expenditures (4 marks) b) Unemployment is a situation where labour force participants are available and willing to work but are unable to find the jobs. Elaborate the measure to control unemployment that can be implemented by the government. (6 marks) c) Economist will focus on achieving macroeconomic goals. There are four major economic goals namely as full employment, price stability, economic growth and equitable distribution of income. However, it is impossible for a government to achieve all four macroeconomic goals simultaneously. Briefly discuss how a government will not be able to implement two particular goals at the same time. (6 marks) d) Investment refers to the spending on purchases and accumulation of capital goods such as buildings, equipment and accumulation of capital goods such as buildings equipment and additions to inventories. Hence, identify the TWO (2) factors influencing investment. (4 marks) QUESTION 2 (20 MARKS) a) International trade refers to exchange of good and services between the people of two countries. Internal trade refers to exchange of goods and services within the political boundaries. Discuss THREE (3) positive impact of international trade to a country. (6 marks) b) Trade restriction is important even though international trade brings a greater increase in world output Explain TWO (2) instruments to enforce protectionism (4 marks) c) Gross domestic product (GDP) and Gross national product (GNP) are very important for the countries. Explain the meaning of GDP and GNP. (4 marks) d) The main concern of any macroeconomic policy is to solve macroeconomics problems and to achieve the macroeconomics goals. The two important sub division of any government policy are the monetary policy and fiscal policy. Differentiate between expansionary fiscal policy and contractionary fiscal policy. (6 marks)