2010 Question 6 Banking

(a) It has been suggested that the main commercial (retail) banks in Ireland should be nationalised.(i) Explain the underlined terms.

(ii) Outline two possible economic arguments for and two possible economic arguments against the nationalisation of the banks. (30 marks)

(i) Nationalisation is

Arguments for nationalisation

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Arguments for nationalisation

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2009 Question 4 Money & Banking(also 2005 Q 7& 2002.)

(a) ‘Banks may fail by overextending their loan book’.

Explain this statement within the context of a bank’s twin requirements of liquidity and profitability.

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(b) Keynes’ concept of ‘Liquidity Preference’ is based on three reasons why people desire to hold wealth in

money form.

(i) State and explain each of these reasons.

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(ii) Discuss the effect, if any, a fall in interest rates is generally expected to have on each of these reasons.

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c) Outline how the recent tightening (reduction) in the availability of credit may affect:

(i) The Irish motor industry

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(ii) Inflation

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(i) Balance of Payments

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2008 Question 8 Money & Banking, Inflation

(ii) Outline how a desire by banks to reduce their level of bad debts might affect their ability to create credit.

(iii) Explain two other factors which could affect their ability to create credit

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(a) (i) Explain, with the aid of an example, how it is possible for banks to create credit. (30 marks)

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2007 Q 7. (b) Suppose the euro (€) increases in value relative to the American dollar ($) and sterling (£).Outline the likely effects this increase would have on any THREE components of the Balance of Payments, which you listed in answering (a) above. [At least one component should be from the Capital Account].(25 marks)

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2007 Q 7.(c) Outline the economic role played by TWO of the following international banking organisations. (25 marks) IMF ECB World Bank 2005 Q 7.(b) The Central Bank of Ireland

2005 Q 7. (c)The euro is now well established as a currency in Ireland. Discuss the economic effects which the introduction of the euro has had on: Irish consumers; Irish exporters and importers

Effects of the Euro on Irish Consumers.

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Effects of the Euro on Irish exporters/importers.

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2003 Question 5 Money & Inflation

(a) Discuss the ways in which money can contribute to the smooth working of an

economy. (20 marks)

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(b) Explain the likely economic effects if: -

(i) the supply of money grows at a faster rate than a country’s production of

goods and services;

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(ii) the supply of money grows at a slower rate than a country’s production of

goods and services;

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2002 Q 5 (b)

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Q 5 (b) Effects of rising interest rates on the Irish economy.

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