(a) What are infant industries?
(b) State any four reasons for protecting infant industries.
(c) Outline any three ways by which industries can be financed in West Africa.
(a) What is balance of payment disequilibrium?
(b) Explain the two types of balance of payment disequilibrium.
(c) Highlight any four reasons most West African countries are experiencing balance of payment problem.
(a) What is deflation?
(b) Outline any three positive effects of deflation.
(c) Explain the ways by which inflation affects any three functions of money.
(a) What is protective tariff?
(b) Outline any four reasons in favour of protective tariff.
(c) State any two reasons against protective tariff.
The table below shows an extract from balance of payments for country A. Use the table to answer the questions that follow:
Balance of payments items
| Items of transaction | Receipts ($) | Payment ($) | |
| 1 | Merchandise (visible trade) | 52,000.00 | 40,000.00 |
| 2 | Shipping, other transport and travel | 4,000.00 | 8,000.00 |
| 3 | Investment income | 20,000.00 | 5,000.00 |
| 4 | Other services | 2,500.00 | 7,500.00 |
| 5 | Unrequired transfers | 22,800.00 | 7,000.00 |
| 6 | Direct investment | 50,000.00 | 26,000.00 |
| 7 | Other long-term capital | 254,000.00 | 289,000.00 |
| 8 | Short-term capital | 221,000.00 | 238,000.00 |
Calculate the:
(a) balance of trade (3 marks)
(b) balance on current account (8 marks)
(c) balance on capital account (6 marks)
(d) balance of payment (3 marks)
