P220/2
ECONOMICS
Paper 2
Jul/Aug 2016
3 Hours
MUKONO EXAMINATIONS COUNCIL
Uganda Advanced Certificate of Education
ECONOMICS
Paper 2
3 Hours
INSTRUCTIONS TO CANDIDATES
- Answer five questions only
- Section A is compulsory. Answers to this section should be precise.
- Answer four questions from section B.
- All questions in section B carry equal marks.
- Credit will be given for use of relevant diagrams.
- Any additional question(s) answered will be marked.
SECTION A (20MARKS)
1. a) (i) What is meant by consumer surplus? (01mark)
(ii) Study the table below and answer the question that follows.
Price in shs | Quantity |
650 | 1 |
600 | 2 |
550 | 3 |
500 | 4 |
450 | 5 |
400 | 6 |
Calculate the consumer surplus when the market price is shs 500 and 4units are
bought.
b) (i) Distinguish between vertical merging and conglomerate merging of firms.
(02marks)
(ii) State two reasons for merging of firms. (02marks)
c) (i) Distinguish between time rate and piece rate methods of wage payment.
(02marks)
(ii) Mention two demerits of using time rate method in your country. (02marks)
d) Give four features of the export sector in your country. (04marks)
e) (i) Differentiate between a funded debt and unfunded. (02marks)
(ii) Mention two objectives for incurring public debts in your country. (02marks)
SECTION B (80MARKS)
2. a) Distinguish between joint supply and competitive supply. (04marks)
b) Account for low price elasticity of supply in your country. (16marks)
3. a) Explain the benefits of expanding the industrial sector in your country. (10marks)
b) Discuss the measures that have been taken to promote the industrial sector in your
country. (10marks)
4. a) What factors are responsible for unfavourable Terms of Trade (T.O.T) in your
country? (10marks)
b) Suggest the measures that should be taken to improve Terms of Trade in your
country. (10marks)
5. a) What factors are put forward by trade unions to demand for a pay rise in your
country? (06marks)
b) Explain the factors that affect the success of Trade Unions in your country. (14marks)
6. a) Differentiate between a deficit budget and surplus budget. (04marks)
b) Account for the persistent budgetary deficits in your country. (16marks)
7. a) Explain the Keynesian theory of unemployment. (04marks)
b) To what extent is the Keynesian theory of unemployment relevant to your country?
(16marks)
End –
