Explain the concept of adaptive expectations. What are its limitations?

What are the implications of policy ineffectiveness proposition?

Explain the concept of current account in the context of foreign trade. How is a deficit in the current account settled?

Distinguish between the concepts of future contract and forward contract.

State the reasons behind exchange rate overshooting.

Bring out the salient features of the asset market approach to exchange rate determination.

Discuss the important conclusions of the Mundell Fleming model.

By using the IS-LM framework, explain the effect of an expansionary fiscal policy on output, prices and rate of interest.

Derive the equations for IS and LM curves. Specify the parameters of the model. Explain how the levels of equilibrium output and interest rate are influenced by changes in these parameters.

 Write a short note on the limits to monetary policy in an economy.

 Explain the major insights from the Ricardian equivalence proposition.

Describe the various channels of monetary transmission mechanism.

State the implications of the knife-edge problem on economic growth of an economy.

Bring out the salient features of the Baumol-Tobin model of transaction demand for money.

Give a brief outline of the major schools of macroeconomic thought.

What is a loss function? How does the shape of the function change according to perception of inflation and unemployment by the Central Bank?

Describe the salient features of business cycle. What are the leading indicators and the lagging indicators of business cycle?

 Explain how a consumer's preference and optimum levels of consumption is determined in the two-period consumption model.

Write a short note on regression through the origin.

Interpret the parameters in a log-linear regression model.