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.

Describe the remedial measures for the presence of multicollinearity in a multiple regression model.

Distinguish between R² and adjusted- R².

What are properties that a good estimator should satisfy?

 Explain the impact of measurement error in independent variable of a regression model.

Which assumption is violated when there is heteroscedasticity in dataset? Describe any three methods of detection of heteroscedasticity.

Explain why an error variable is added to the regression model. Distinguish between the error term (u) and the residual (û).

What is meant by autocorrelation? Describe the reasons for the presence of autocorrelation in regression model. What are the consequences of autocorrelation?

Specify a multiple regression model. Point out the assumptions about the error term. Describe how the parameters of the model can be estimated by maximum likelihood method.

 Discuss the factors that lead to a shift in the medium-run aggregate supply (AS) curve.

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

What are the implications of policy ineffectiveness proposition?

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

Explain the major insights from the Ricardian equivalence proposition.

State the reasons behind exchange rate overshooting.