TEST EXAMS

Semester Two Finance

Instruction

Section one (choice/circle the write answer).

Section two (Answer two Question and Question one is compulsory)

SECTION ONE.( choice/circle the correct answer)

1. Which of the following cannot be quality of good money:

a) Homogeneity
b) Portability
c) Durability
d) Commodity money standard.
2. These are functions of good money are except:
a) Do not acts as standard of deferred payment.
b) It is a unit of account.
c) Acts as a measure of value.
d) All of them.

3. The central bank controls credit by using the following, except

a) Open market operation;

b) No special deposit.

c) Legal reserve requirement.

d) Bank rate.

4. These are not Causes of frictional unemployment except

a. A fall in investment

b. Geographical immobility of labour

c. A fall in prices of goods and services

d. Increase in importation

5. The demand for money is influenced by certain motives, except

a) Speculative motive
b) Interest motive
c) Transection motive
d) Precautionary motive
 6. These are not Functions of commercial bank, except:
a) Acts as the banker to the government.
b) Acts as a banker to the other financial institutions like IMF and
the World Bank.
c) The lender of last resort.
d) They offer credit those who in financial needs.

7. _______________ This is the difference between incomes received by

domestic production factors abroad and incomes received by foreign
production factors it the country.
a) The Growth Domestic Product
b) The Net Factor Product (NFP)
c) The Net national Product (NNP)
d) None of the above
8. Which of the following is not one of the objectives for monetary policy:
a) To stabilize the exchange rates.
b) To not Increase the level of Aggregate demands.
c) To stabilize the countrys B.O.P position.
d) To stabilize the price of the goods and services in the economy.

9. ____________ estimate measures the value of commodity and services

turned out during a given period without duplication.
a) Economics
b) Demand of economy
c) Monetary policy
d) National income
10. ______________This type of unemployment which results from a
deficiency in aggregate goods. It exists due to fluctuations in the
business or trade cycle:
a) Cyclical unemployment
b) Frictional unemployment
c) Open Urban Unemployment
d) All of them

SECTION TWO (Answer only two Questions and Question one is

compulsory).
1. Write short notes of the following
a) Growth Development product and Growth National Product.
b) Open urban unemployment and Technical unemployment.
c) Commercial banks and Central bank
d) Monetary policy and National Inocme.
 e) Economics and money Demand.
f) Macroeconomics and microeconomics
2. a) By using your own words briefly explain the overall meaning of money
demand? And explain the factors affecting/determining demand for
money (liquidity preference).
b) Explain types and evaluation of money?
3. a) By using your own words define unemployment?
b) Discuss the General causes and solutions of unemployment?
4. a) define national income with different perspective?
b) explain the defference between the sectors of the economy?