BBM202/05 MACROECONOMICS Assignment 2 (Assignment 2 – 25%) Assignment 2 Instructions: 1

BBM202/05 MACROECONOMICS

Assignment 2 (Assignment 2 – 25%)

Assignment 2
Instructions:
1. Assignment 2 covers the topics in Units 3 and 4.
2. Assignment 2 contains:
THREE questions
Answer all questions.
3. The total marks for Assignment 2 is 100 which is equivalent to 25% of your
final total marks.
4. All students must submit the T-DF Assignment Declaration Form as the front
cover when you submit your Assignment.
5. The deadline for the submission of Assignment 2 is on 25 October 2020
before 12.00 midnight.

Answer ALL questions
Question 1
(a) Elaborate on the FOUR (4) main functions of money.
[16 marks]
(b) Elaborate on the components of M2 in the Malaysian context. [You may
need to refer to Bank Negara Malaysia’s report]
[14 marks]
Question 2
(a) Based on BNM or news report, explain the latest changes in the statutory
reserve requirement (SRR) for Malaysia. Your explanation should also
include the changes to money supply and the possible impact of the
change.
[15 marks]
(b) Based on your answer above, select an economic problem where that
impact would work and explain what could happen.
[15 marks]
Question 3
Using the aggregate demand and aggregate supply model, explain the effects of
the following on price and real income in Malaysia.
(a) Consumers are worried with the country’s economic progress.
[10 marks]
(b) Firms have begun to use more high-tech machineries for production.
[10 marks]
(c) The Malaysian government has decided to spend on a major revamp of
the public transportation system.
[10 marks]
(d) Malaysian higher education system has produced highly skilled
employees.
[10 marks]
END OF ASSIGNMENT 2