Question 1

(a) Elaborate on the FOUR (4) main functions of money.

[16 marks]

(b) Elaborate on the components of M2 in the Malaysian context. [You may need to refer to Bank Negara Malaysia's report]

[14 marks]

Question 2

(a) Based on BNM or news report, explain the latest changes in the statutory reserve requirement (SRR) for Malaysia. Your explanation should also include the changes to money supply and the possible impact of the change.

[15 marks]

(b) Based on your answer above, select an economic problem where that impact would work and explain what could happen.

[15 marks]

Question 3

Using the aggregate demand and aggregate supply model, explain the effects of the following on price and real income in Malaysia.

(a) Consumers are worried with the country's economic progress.

[10 marks]

(b) Firms have begun to use more high-tech machineries for production.

[10 marks]

(c) The Malaysian government has decided to spend on a major revamp of the public transportation system.

[10 marks]

(d) Malaysian higher education system has produced highly skilled employees.

[10 marks]