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Economic growth, economic development and economic planning

Unit: Economics

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Practice CPA Economics Economic growth, economic development and economic planning questions with detailed answers and explanations.

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August 2025

 2 Questions
Question 3c
​​Highlight FOUR ways a country can increase foreign reserves.


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Question 4c
​​Examine FIVE merits of adopting import-substitution strategy in developing countries.


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April 2025

 3 Questions
Question 5a
​​Highlight FIVE limitations of economic planning in developing countries


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Question 5b
​​Explain FOUR advantages of localisation of industries in a country.


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Question 7c
​​Explain FIVE arguments against international trade restrictions.


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December 2024

 8 Questions
Question 1b
​​State FOUR challenges associated with regional economic integration in developing countries.


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Question 3b
​​Summarise SIX measures that the governments in developing countries may put in place to spur growth in the informal sector.


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Question 5d
​​Explain FOUR positive environmental impacts of economic growth.


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Question 6b
​​Summarise FOUR economic implications of rural-urban migration.


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Question 6d
​​Analyse FOUR causes of unfavourable balance of payment in developing countries.


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Question 7a
​​Outline SIX challenges developing countries face due to over reliance on foreign aid.


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Question 7c
​​Discuss FOUR restrictions to international trade.


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Question 7d
​​Explain FOUR challenges facing the agricultural sector in developing countries.


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August 2024

 9 Questions
Question 1d
​​Describe FOUR strategies that developing countries might apply to correct the balance of payment deficit.


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Question 2c
​​State FOUR challenges faced by small scale industries in developing countries.


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Question 2d
​​Outline FOUR characteristics of developing countries.


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Question 3b
​​Argue SIX cases for restrictions in international trade.


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Question 4a
​​State FIVE factors that limit the success of economic integration in developing countries.


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Question 4b
​​Distinguish between “debt distress” and “debt conversion”.


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Question 4c
​ ​​Outline SIX methods that may be adopted to clear external debts in developing countries.


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Question 5b
​​Discuss THREE forms of economic integration in relation to international trade.


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Question 6a
​​State FIVE features that influence the level of Foreign Direct Investment (FDI).


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April 2024

 5 Questions
Question 2b
​​Argue THREE cases in favour of Foreign Direct Investment (FDI) in least developed countries.


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Question 4a
​​Enumerate FIVE challenges that could contribute to ineffectiveness of trade unions in developing countries.


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Question 4d
​​Propose FIVE policy measures that the government of a country could take to accelerate economic development.


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Question 6a
​​Identify FIVE obstacles to economic growth and development in developing countries.


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Question 7d
​​Outline THREE measures that developing countries might use to promote agricultural production.


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December 2023

 5 Questions
Question 1a
​​(i) Explain the term “economic planning”. 

(ii) Argue FOUR cases in favour of government investment in the process of economic planning.


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Question 1d
​​Explain FIVE causes of rising foreign debt in least developed countries.


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Question 3a
​​Discuss FOUR sets of economic reforms that the Bretton Woods financial institution may impose on a country.


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Question 3b
​​Describe SIX roles of industry in economic development of the least developed countries.


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Question 5c
​​Outline SIX demerits of delocalisation of industries.


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August 2023

 5 Questions
Question 1a
​​State FIVE advantages of a planned economy.


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Question 1d
​​State THREE determinants of economic development.


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Question 6a
​​(i) Explain the term “Structural Adjustment Programmes” (SAPs). 

(ii) Discuss THREE criticisms of SAPs in least developed countries.


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Question 6b
​​Analyse FOUR challenges that may be encountered by an economy when transitioning from a planned economy to a free enterprise system.


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Question 7c
​​Describe SIX arguments in favour of regional integration in relation to international trade.


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April 2023

 8 Questions
Question 1c
​​List FIVE measures that may be adopted to correct income inequalities in developing countries.


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Question 2a
​​(i) Explain the term “Gini Coefficient” as used in economics. 

(ii) Describe THREE principles of the Gini Coefficient.


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Question 2b
​ ​​State SEVEN roles of the World Bank Group to a member state.


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Question 2c
​ ​ ​​With the aid of a diagram, explain regressive supply curve.


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Question 3b
​​Identify FIVE tax measures that a government could adopt to spur growth in the agricultural sector.


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Question 5a
​​Most developing countries are faced with a problem of high external debts. 

 As an economist, outline EIGHT policy measures that the developing countries could put in place to minimise the problem of rising external debt.


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Question 6b
​​Identify SIX advantages of economic integration to the member states.


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Question 6c
​​Explain FOUR negative effects of increased government spending on economic growth.


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December 2022

 4 Questions
Question 1a
​​Enumerate FIVE functions of the World Trade Organisation (WTO).


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Question 4c
​​State SIX policy measures that a country could adopt to avoid the risk of not being able to honour her foreign debts.


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Question 5b
​​State SIX policy measures that could be adopted by developing countries to encourage industrial development.


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Question 7a
​​Outline SIX characteristics of a good economic development plan.


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August 2022

 5 Questions
Question 1a
​​Explain five demerits of trade liberalisation in an economy.


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Question 1b
​​Explain five reasons why income inequalities are a major policy issue in developing countries.


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Question 2a
​​Identify five requirements for proper economic planning.


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Question 6a
​​(i) Outline five challenges faced by the agricultural sector in developing countries. (5 marks)

(ii) Suggest five policy measures that should be put in place by developing countries to help improve the agricultural sector.


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Question 7a
​​Explain six roles played by foreign investment in least developed countries.


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April 2022

 3 Questions
Question 1a
​​ Discuss five challenges encountered by planned economic system in their transition to market oriented economies.


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Question 4a
​​Assess five forms of economic integration as used in international trade.


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Question 7c
​​(i) With reference to economic growth and development, explain the term "potential growth". 

(ii) Examine six benefits of economic growth and development.


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Pilot December 2021

 1 Questions
Question 1b
​ ​​Discuss the four main goals of macroeconomic policy in developing countries.


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December 2021

 5 Questions
Question 1d
​​Outline seven advantages of a free market economic system


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Question 3c
​​Discuss five technical economies of scale.


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Question 4b
​​Outline five factors that determine the economic development of a country


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Question 5b
​​Enumerate seven criticisms levelled against the theory of comparative advantage.


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Question 7c
​​Outline seven limitations of regional economic integration in developing countries.


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August 2021

 5 Questions
Question 2c
​​Justify five reasons why devaluation in developing countries tends to be inflationary.


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Question 3a
​​Highlight six economic factors that may contribute to poor performance of the agricultural sector in developing countries.


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Question 4b
​​With the help of a diagram, explain the marginal efficiency of capital


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Question 6b
​​Identify four effects of Covid-19 pandemic on the world economy.


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Question 6c
​​(i) Define the term "free enterprise economic system."
(ii) Highlight four economic advantages of free enterprise economic system.


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May 2021

 6 Questions
Question 1a
​​Evaluate four ways in which the government could influence allocation of resources in a country


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Question 3c
​​Kenya, which is currently ranked as a developing country, came up with an economic blueprint geared towards realising economic development by the year 2030.

Required:
(i) Describe five factors that might hinder Kenya from realising the above objective.
(ii) Outline measures that might be put in place in order to overcome the impediments in (c) (i) above.


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Question 5b
​​Examine five reasons for deteriorating terms of trade for developing countries.


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Question 6a
​​(i) Describe the term "economic integration".
(ii) Highlight six factors that limit successful economic integration in developing countries.


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Question 6b
​​Examine four advantages of currency devaluation to a country's economy.


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Question 7c
​ ​​With the aid of a diagram distinguish between "actual economic growth" and "potential economic growth


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November 2020

 6 Questions
Question 1a
​​Explain four methods used by the government to stabilise agricultural prices.


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Question 4c
​​Explain the term "economic planning".


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Question 4d
​​Highlight six characteristics of a good economic plan


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Question 7a
​​Summarise six corrective measures that developing countries should institute to correct the persistent deficits in their balance of payments position.


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Question 7b
​​Discuss four policy recommendations that developing countries should institute to reduce regional imbalances in their economics.


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Question 7c
​​Justify six reasons why external debt problems is a major policy issue in developing countries.


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November 2019

 5 Questions
Question 1a
​​Examine four limitations of a planned economic system.


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Question 6a
​​Identify four reasons against international trade restrictions.


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Question 6b
​​Summarise four functions of World Trade Organisation (WTO). 


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Question 6c
​​The citizens of your country have raised concern over the increased rate of Foreign Direct Investment in your country.

Required:
Assess four cases in favour of and four cases against Foreign Direct Investment in an economy


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Question 7b
​​Explain five benefits of development planning in an economy. 


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May 2019

 1 Questions
Question 6c
​​Explain causes of high levels of external debt in developing countries.


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November 2018

 3 Questions
Question 5b
​​ Outline limitations of adopting export promotion strategy in developing countries.


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Question 6c
Discuss disadvantages of adopting an import substitution strategy to control unfavourable balance of payments in a developing country.


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Question 7b
Analyse obstacles to industrial development in developing countries.


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May 2018

 2 Questions
Question 2b
Explain six reasons why a country might impose international trade restrictions.


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Question 3d
Highlight five determinants of economic development in a country


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November 2017

 5 Questions
Question 1a
​​ Explain the following types of development plans:
(i). Short term plans.
(ii). Medium term plans.
(iii). Long term plans.


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Question 1d
Enumerate five advantages and five disadvantages of a planned economic system.


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Question 2b
Examine eight policy measures that could be adopted to minimise the problem of rising external debt in developing countries.


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Question 5b
Explain five advantages of implementing exports promotion strategy in developing countries.


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Question 5c
 Highlight ten problems that are faced by the agricultural sector in developing countries.


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May 2017

 3 Questions
Question 4b
Suggest six economic reforms that could be put in place to boost the growth of the informal sector in developing countries


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Question 6a
Argue the case for and against regional economic integration by developing countries.


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Question 7a
Describe five causes of balance of payment deficits in developing countries


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November 2016

 5 Questions
Question 1b
Outline six advantages of a controlled market system.


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Question 4a
 Highlight five strategies that could be implemented by governments in developing countries to spur growth in the industrial sector.


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Question 5a
The United Kingdom (UK) recently withdrew its membership from the European Union (EU), a process that was referred to as "Brexit". Analyse the likely economic effect of "Brexit" on the United Kingdom's:
(i) Exchange rates.
(ii) Interest rates.
(iii) Inflation rate.
(iv) Securities exchange market


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Question 7c
Summarise eight challenges that hinder successful achievement of national development targets set by developing countries


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Question 7d
The economic transactions for a hypothetical economy in thousands of shillings are given as follows:

Sector

Total output
Sh."000"		Intermediate purchaser
Sh."000"
Service
Agricultural
Manufacturing		76,000
55,000
110,000		37,000
23,000
69,000


Indirect taxes and fixed assets depreciation amount to Sh.21,000,000 and Sh.22.000.000 respectively.

Required:
(i) Gross national product using the value added approach.

(ii) Net domestic product at market price

(iii) Net domestic product at factor cost.


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May 2016

 2 Questions
Question 3a
​​ Discuss five policy measures that developing countries could adopt to reduce regional imbalances.


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Question 7c
​​State seven economic goals of developing countries.


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November 2015

 2 Questions
Question 4b
​​Enumerate five changes in the tax policy that could be implemented by a government to spur growth in the agricultural sector.


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Question 6b
​​(i) Outline six causes of high levels of external debts in developing countries.

(ii) Summarise six policies that could be adopted to combat the problem of high levels of external debts in developing countries. 


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Pilot September 2015

 1 Questions
Question 4b
​ ​​ Distinguish between "economic growth" and "economic development".


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