Question 4 [25 marks]

(a) In your view, why did the Yugoslavian businesses refuse to take the Yugoslavian

currency and instead used the German Deutsche Mark? [5]

(b) What is price stability and why is it important particularly for business environment?

[10]

(c) Explain why should deflation which is described as falling of general price level cause

problems to the whole economy? (10)

SECTION B COMPULSORY

QUESTION 5 [15 marks]

(a) Discuss the difference between GDP & GNP? (5marks)

(b) Is Growth Desirable and Sustainable? Economists typically see economic growth as

desirable and sustainable. But not all social observers agree. Explain why? Hint: what

are Antigrowth views? [10]

(c) Discuss the reasons behind the fluctuations in the Gross Domestic Product of Namibia.