Economics 2016 November Knec Past Paper

SECTION A (32 marks)
Answer ALL the questions in this section.
1. Human wants have certain characteristics. Highlight four such characteristics. (4 marks)
2. Explain four advantages of labour specialization to an organization. (4 marks)
4. Individuals hold money for different motives. State three such motives. (3 marks)
5. State three types of foreign investment that a country can attract. (3 marks)
6. Outline three methods of trade restrictions that a country can adopt. (3 marks)
7. Highlight three components of money supply. (3 marks)
9. State three causes of structural unemployment in a country. (3 marks)
10. Highlight four characteristics of money as a medium of exchange. (4 marks)
Country X intends to measure its national income. Outline three methods that the country can adopt in carrying out the exercise.
Outline two measures that a government may take in order to stabilize prices of farm produce. (2 marks)
SECTION B (68 marks)
Answer any FOUR questions from this section.
11. (a) There are certain decisions that a producer needs to make as a result of the economic problem of scarcity of resources. Explain four such decisions. (8 marks)
(b) Country X has recently imposed a higher rate of direct taxation on its citizens. Explain six limitations of such a high level of taxation. (9 marks)
(a) Most of the less developed countries experience high levels of unemployment. Explain six causes of such levels of unemployment. (8 marks)
(b) A country’s size of national income is influenced by certain factors. Explain six such factors. (9 marks)
(a) The management of Tingler Company Ltd intends to institute measures to enhance the industrial relations with its employees. Explain four such measures. (8 marks)
(b) Elasticity of demand for a product is influenced by certain factors. Explain such factors. (9 marks)
(a) Zipler an IT firm intends to employ people with highly specialized skills. Explain four problems that the firm may experience from employing such workers. (8 marks)
(b) The central bank in a country is expected to perform certain functions.
Explain six such functions. (9 marks)
4* (a) Hannah recently established her own sole-proprietorship business. Explain six advantages of such a form of business organization. (9 marks)
(b) Country Y intends to impose import restrictions. Explain four reasons that may account for this move

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