ASSIGNMENTS 2015-16 Second Year Courses (For July 2015 and January 2016 Sessions)
School of Social Sciences Indira Gandhi National Open University Maidan Garhi, New Delhi-110 068
Master of Arts (Economics) (TMA) (2015-16)
Dear Student, As explained in the programme guide for MEC, assignments carry 30 per cent weightage in a course and it is mandatory that you have to secure at least 40 per cent marks in assignments to complete a course successfully. Note that you have to submit the assignments before appearing in Term End Examination of a course. Before attempting the assignments please read the instructions provided in the programme guide sent to you separately. In this booklet we have included the assignments for all the courses pertaining to the second year. In each course there is a Tutor Marked Assignment (TMA). You have to do the assignment for those courses for which you have registered. Do remember that you have to prepare and submit the assignments separately for each course. Make sure that you submit the assignments well in time for those courses in which you plan to appear in the Term End Examination.
Submission For July 2015 session, you need to submit the assignments by March 31, 2016, and for January 2016 session by September 30, 2016 for being eligible to appear in the termend examination. Assignments should be submitted to the Coordinator of your Study Centre. Obtain a receipt from the Study Centre towards submission.
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MEC-006:PUBLIC ECONOMICS Assignment (Coverage: Blocks 1 to 6) Course Code: MEC-006 Asst. Code: MEC-006/AST/2015-16 Maximum Marks: 100 Note: Answer all the questions. 20 2=40
A.
Long Answer Questions. (Answer in about 500 words each)
1.
Explain the characteristic features of public intervention. Explain how public intervention tries to influence allocation and distribution of societal resources.
2.
Describe the various stages involved in policy process. What are the main characteristics of the interactive model of policy formulation?
B.
Medium Answer Questions. (Answer any five in about 300 words each)
3.
What do you mean by a Social Welfare Function? Explain Samuelson-Bengson’s Social Welfare Indifference Curves.
4.
Why is the ‘Benefits Received Approach’ not applicable for direct taxes?
5.
How the burden of public debt is transferred to future generations through reduced capital formation?
6.
Explain the important reasons for the emergence of horizontal federal fiscal Imbalance.
7.
Is there scope for inter-governmental Competition in the Tiebout model?
8.
Differentiate between the following; (i) Positive externalities and negative externalities (ii)
Optimal efficient tax structure and optimal tax system
(iii)
Current transfer and capital transfer
3
125=60
MEC-007: INTERNATIONAL TRADE AND FINANCE Assignment (Coverage: Blocks 1 to 6) Course Code: MEC-007 Asst. Code: MEC-007/AST/2015-16 Maximum Marks: 100 Note: Answer all the questions. 20 2=40
A.
Long Answer Questions. (Answer in about 500 words each)
1.
Describe magnification effect in the context of H-O model. What theorem is derived from the assumption in the H-O model that the two countries share the same technology and that markets are perfectly competitive? Explain.
2.
Critically explain the statement that “Balance of payments is a monetary phenomenon”. Explain the fact that balance of payments surplus means excess of central bank credit over the demand for real money balances in the economy.
B.
Medium Answer Questions. (Answer any five in about 300 words each)
3.
What are the controversial issues for trade in services in India?
4.
Briefly discuss the welfare effects of Regional Trade Agreements both in case of (i) trade diversion and (ii) trade creation.
5.
What are the current issues concerning India in WTO? Are multilateralism and regionalism compatible?
6.
What is the relation between the infant industry and the market failure arguments for
125=60
protection? 7.
What do you mean by Gold Standard? Why Gold Standard is considered to be fixed exchange rate regime?
8.
Differentiate between the following; (i)
Fixed exchange rate and Floating exchange rate
(ii)
External assistance and External commercial borrowing
(iii)
Current account transactions and Capital account transactions
4
MEC-008: ECONOMICS OF SOCIAL SECTOR AND ENVIRONMENT Assignment (TMA) Course Code: MEC-008 Assignment Code: MEC-008/AST/2015-16 Maximum Marks: 100 Note: Answer all the questions. While questions in Section A carry 20 marks each (to be answered in about 500 words each) those in Section B carry 12 marks each (to be answered in about 300 words each). In the case of numerical questions word limits do not apply. SECTION-A 1.
Discuss the two major measures of development? How does the concept of Sustainable Development differ in its thrust from those of the measures discussed before?
2.
Discuss the Bionomic Model useful for determining the equilibrium levels for maximization of net growth in fish production/harvest. How is it applicable in generating sustainable revenue. SECTION-B
3.
Discuss the different policy instruments adopted for ‘regulation’ by the government.
4.
Bring out the differences in the SEEA and ENRAP methods of extension of the System of National Accounts (SNA).
5.
Explain the Faustmann condition for the ‘Optimal Harvesting Age’ of timber.
6.
How is ‘Returns to Education’ defined? Distinguish between the concepts of Private Returns and Social Returns to education.
7.
Explain the two indicators of QALYs and DALYs used for measuring the economic benefits realized due to medical interventions.
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MEC-009: RESEARCH METHODS IN ECONOMICS Assignment (TMA) Course Code: MEC-009 Assignment Code: MEC-009/AST/2015-16 Maximum Marks: 100 Note: Answer all the questions. While questions in Section A carry 20 marks each (to be answered in about 700 words each) those in Section B carry 12 marks each (to be answered in about 500 words each). In the case of numerical questions word limits do not apply. SECTION - A 1. “Science is qualitatively distinct from, superior to and ideal for all areas of human endeavor” - In the light of this statement, examine the positivist approach and pauper’s approach of scientific method for carrying out research in economics. 2. What is the distinction between realism and instrumentalism? Examine the contribution made by Milton Friedman in the area of methodology of Economics. SECTION - B 3. Distinguish between experimental research and evaluative research. Formulate a research proposal of experimental research following the different steps explained in unit 5. 4. State the various assumptions of classical linear regression model. How will you detect multi co linearity in regression model? What are the consequences of multi-co linearity problem? 5. What type of data is released by National Family Health Survey? How this data is useful for a researcher engaged in carrying out research in the area of health economics? 6. Explain the various steps involved in processing of qualitative data. 7. Discuss the various steps involved in construction of price index numbers. How consumer price index numbers are useful for different sections of the society?
Note: Answer all the questions. While questions in Section A carry 20 marks each, those in Section B carry 12 marks each. SECTION - A 1.
The relationship between Y and X is given by where follows classical assumptions. Consider the following set of data and answer the questions. Y X
1 8
2 6
3 9
4 12
5 10
a) Estimate parameters of the model from the following data by using OLS method. b) What is the estimate of error variance in the above case? c) Find the value of for the above data. 2.
How do you express the multiple regression model in matrix form? Derive OLS estimator for the parameters of the model. Show that the OLS estimators are Best Linear Unbiased Estimators (BLUE). SECTION - B
3.
Why is OLS inappropriate when a dataset is having autocorrelation problem? Explain how Durbin Watson test is used for detection of autocorrelation. Calculate DurbinWatson statistic for the dataset given at Question 1 above and interpret the result. 3. What is meant by dynamic model? Explain how the following model can be estimated? where | | 1 + . In the above model is distributed independent, normal with mean zero and variance and || 1.
5.
Consider the following demand and supply model for money. Demand for Money: Supply of Money: 7
where M = Money, Y = Income, P = Price, and R = rate of interest Assume that R and P are pre-determined. a) Check the identification status of demand and supply equations above. b) What method would you use to estimate the supply equation? 6.
Monthly salary of executives in a call centre depends upon years of experience, educational qualification (diploma/degree) and time of work (morning/evening/night). Formulate the regression equation for the above scenario. Explain how interactive dummy between experience and educational qualification can be included in the above. How do you interpret the coefficients? When do you expect a situation of dummy variable trap in the above formulation?
7.
Explain the concept of heteroscedasticity. What are its consequences on estimates? What remedial measures would you suggest for the problem of heteroscedasticity?
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MECE-003: ACTUARIAL ECONOMICS: THEORY AND PRACTICE (Assignment) Course Code: MECE-003 Assignment Code: MECE-003/TMA/2015-16 Marks: 100 SECTION - A Answer all the questions from this section.
1.
a)
2×20=40
Describe the Gambler’s Ruin problem. How can you find out the duration of a walk, both in unbiased and biased walk? Explain
b)
Describe arbitrage-free pricing for insurance. Discuss the non-arbitrage constraint in which in insurer accepts the liability to pay for the loss claimed and comment on its relation to insurance pricing.
2.
a)
Define the term Survival function.
b)
Describe different stochastic models in life insurance contracts. SECTION - B
Answer all questions from this section.
3.
4.
5×12=60
a)
Describe Buhlmann credibility theory.
b)
Describe the basic principles of reserving models.
c)
Define Markov chain. How do you present a homogenous Markov chain?
d)
Discuss Chapman-Kolmogorov equation.
a)
Justify the equivalence principle used for deciding the insurance
premiums.
Write the equation of equivalence principle and explain it to support your justification for premium fixation. b) 5.
What is the meaning of individual risk model?
Write short notes on the following: i)
Premium principles
ii)
Compound-Poisson Process
iii)
Black-Scholes model 9
6.
a)
What is Extreme Value Theory (EVT) used for? Explain the Generalized Extreme Value (GEV) distribution.
7.
b)
Describe how insurers manage their risks in ways other than re-insurance.
a)
What is life table? Describe different columns of a life table.
b)
Discuss about valuing contingent payments in insurance.
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MECE-004: FINANCIAL INSTITUTIONS AND MARKETS (Assignment) Course Code: MECE-004 Asst. Code: MECE-004 / AST-1/2015-2016 Total Marks: 100 Note: Answer all the questions. While questions in Section A carry 20 marks each (to be answered in about 500 words each) those in Section B carry 12 marks each (to be answered in about 300 words each). In the case of numerical questions word limits do not apply. Section- A
1)
Discuss Markowitz’s portfolio theory of asset pricing. Critically examine the efficientmarkets hypothesis.
2)
Critically examine the Quantity Theory of Money as a theory of the demand for money and contrast it with the Keynesian theory of the demand for money. Section-B
3)
Distinguish between a futures contract and a forward contract. Briefly explain the Binomial options pricing model.
4)
What do you understand by ‘duration’ as used in the analysis of fixed-income securities? In what way is the so-called ‘modified’ duration measure a modification of the Macaulay measure?
5)
What is the role of stock markets in the economy? As an asset, how do bonds differ from shares?
6)
What is an expected utility function? What are the important properties that an expected utility function has?
7)
What is a customs union? How does it work? In what way is it different from an Optimum Currency Area?
