Question 1:
(a) Illustrate out the rationale behind financial sector development and liberalisation in developing economy like Mauritius.
(b) Discuss and illustrate out the various policy and institutional changes which has taken place in Mauritian financial system over the years. Has financial liberalisation been really a success in Mauritian economy till date? Why or why not?
Question 2:
(a) Clearly discuss and illustrate out the different roles performed by retail banking, wholesale banking and corporate banking. How can these institutions foster the financial intermediation procedure?
(b) Discuss and illustrate out the arguments behind the financial intermediation process.
Question 3:
(a) By clearly illustrating the concepts of bank soundness and banking fragility, explain and illustrate out the rationale behind banking sector supervision in developing economy like Mauritius.
(b) Discuss and illustrate out the various measures that the Bank of Mauritius has set in place in order to regulate and monitor banking activities in Mauritius.
Question 4:
(a) Clearly illustrate out the concept of rules versus discretionary central banking policies.
(b) Discuss the numerous risks encountered by the financial system and discuss measures to control and mitigate such risks. Can the Basle II Framework eliminate these risks?
Question 5:
‘The Managed Float system of exchange rate is regarded as being too costly to operate but it is tool to control an economy’s health.’ Comment and explain.