lOMoARcPSD| 63158501
UNIVERSITY EXAMINATIONS
Oct/Nov 2025
ECS3701
Monetary Economics
100 Marks
Duration: 2 Hours
First Examiner: Prof TLA Leshoro
Second Examiner: Ms T Moletsane
External Examiner: Ms PA Mathebula
This paper consists of 4 pages, including this cover page and the invigilator app page. There
are 5 questions in this paper.
CONFIDENTIAL
Instructions:
(1) Once you have completed your answers submit them as a single document in PDF format using the
eAssessment tool on the myExams portal. It is preferable for you to type your answers (Font: Arial 12)
and then convert your document to PDF format for submission. However, if this is not possible, you
may also write your answers down and scan them into a PDF file. Please write legibly.
(2) Start with a cover page stating the module code (ECS3701) and your student number.
(3) This should be followed by your answers to the questions.
(4) Make sure that each question and sub-questions are clearly numbered.
(5) Your answers must not exceed 10 pages. Pages 11 and beyond will NOT be marked.
(6) While you are not required to cite your sources, this does not mean that you can simply copy
information from any source. You need to answer the questions in your own words. Plagiarism
will not be tolerated and may result in disciplinary action if detected. Plagiarism will result in
zero marks awarded.
(7) Please ensure that you submit a declaration of honesty on myUnisa.
(8) You will need your student number and password to access this platform.
(9) You need to accept the honour pledge because it is compulsory for every student otherwise you will not
be able to access the paper, let alone upload it. This information will be used to report to the Student
Disciplinary Committee should incidents of plagiarism be suspected.
(10) Please preview and verify your document before you submit to ensure that it is free of errors, it is
readable, that your PDF document is NOT encrypted to a “secured” mode and it is NOT password
protected as these files cannot be marked. Virus-infected files will also not be marked.
(11) You have 2 hours to complete this assessment.
(12) Late submissions will NOT be marked. Emailed scripts will NOT be marked.
(13) This is a CLOSED-BOOK examination. You must not consult outside sources. You must treat this as a
venue-based examination, hence the use of an invigilator app.
(14) Once you have submitted on the dedicated platform, you will receive an on-screen message of
successful submission. Please keep this email safe as a proof of your submission.
(15) If you insist on not being able to upload on the submission portal, you must contact the number and
email address provided in the QA documents posted on the announcement on the module page and
provide screenshots of the error screens.
STUDENT NUMBER
, lOMoARcPSD| 63158501
[TURN OVER]
Page 2 of 4 ECS 3701
Oct/Nov 2025
, lOMoARcPSD| 63158501
Good Luck!
[TURN OVER]
Page 3 of 4 ECS 3701
Oct/Nov 2025
ANSWER ALL FIVE QUESTIONS
Question 1 [20 marks]
1.1 Explain the transmission mechanism of monetary policy. [2]
1.2 There are different channels or transmission mechanisms of monetary policy. Which of these
transmission mechanisms is the most important? Provide 3 reasons to support your answer.
[5]
1.3 Indicate whether each of the following statements is true (T) or false (F) [13]
1) The government authorities in charge of monetary policy are the central banks.
2) The action of the Reserve Banks in changing the repo rate will cause changes in the
demand-side inflation.
3) Reserve Banks can only conduct open market operations but not influence the reserve
requirement ratio.
4) Money supply is positively related to the amount of excess reserves.
5) The three tools that the South African Reserve Bank (SARB) uses can only be used to
reduce inflation.
6) In a barter economy, transaction costs are relatively low because people need to satisfy
a double coincidence of wants.
7) Money has different primary functions in an economy when money is shells, gold, or
paper.
8) Open Market Operations is not one of the tools that the South African Reserve Bank
(SARB) uses.
9) Financial intermediaries allow small savers and borrowers to benefit from the existence
of financial markets.
10) One solution to the problem of high transaction costs is to bundle the funds of many
investors together so that they can take advantage of economies of scale.
11) The money multiplier tells us how much monetary base changes given a change in the
money supply.
12) Money cannot be referred to as money supply as they have different definitions.
13) The independence of the South African Reserve Bank means that it is unlikely to focus
on the long-term objectives but seeking short-term solutions.
UNIVERSITY EXAMINATIONS
Oct/Nov 2025
ECS3701
Monetary Economics
100 Marks
Duration: 2 Hours
First Examiner: Prof TLA Leshoro
Second Examiner: Ms T Moletsane
External Examiner: Ms PA Mathebula
This paper consists of 4 pages, including this cover page and the invigilator app page. There
are 5 questions in this paper.
CONFIDENTIAL
Instructions:
(1) Once you have completed your answers submit them as a single document in PDF format using the
eAssessment tool on the myExams portal. It is preferable for you to type your answers (Font: Arial 12)
and then convert your document to PDF format for submission. However, if this is not possible, you
may also write your answers down and scan them into a PDF file. Please write legibly.
(2) Start with a cover page stating the module code (ECS3701) and your student number.
(3) This should be followed by your answers to the questions.
(4) Make sure that each question and sub-questions are clearly numbered.
(5) Your answers must not exceed 10 pages. Pages 11 and beyond will NOT be marked.
(6) While you are not required to cite your sources, this does not mean that you can simply copy
information from any source. You need to answer the questions in your own words. Plagiarism
will not be tolerated and may result in disciplinary action if detected. Plagiarism will result in
zero marks awarded.
(7) Please ensure that you submit a declaration of honesty on myUnisa.
(8) You will need your student number and password to access this platform.
(9) You need to accept the honour pledge because it is compulsory for every student otherwise you will not
be able to access the paper, let alone upload it. This information will be used to report to the Student
Disciplinary Committee should incidents of plagiarism be suspected.
(10) Please preview and verify your document before you submit to ensure that it is free of errors, it is
readable, that your PDF document is NOT encrypted to a “secured” mode and it is NOT password
protected as these files cannot be marked. Virus-infected files will also not be marked.
(11) You have 2 hours to complete this assessment.
(12) Late submissions will NOT be marked. Emailed scripts will NOT be marked.
(13) This is a CLOSED-BOOK examination. You must not consult outside sources. You must treat this as a
venue-based examination, hence the use of an invigilator app.
(14) Once you have submitted on the dedicated platform, you will receive an on-screen message of
successful submission. Please keep this email safe as a proof of your submission.
(15) If you insist on not being able to upload on the submission portal, you must contact the number and
email address provided in the QA documents posted on the announcement on the module page and
provide screenshots of the error screens.
STUDENT NUMBER
, lOMoARcPSD| 63158501
[TURN OVER]
Page 2 of 4 ECS 3701
Oct/Nov 2025
, lOMoARcPSD| 63158501
Good Luck!
[TURN OVER]
Page 3 of 4 ECS 3701
Oct/Nov 2025
ANSWER ALL FIVE QUESTIONS
Question 1 [20 marks]
1.1 Explain the transmission mechanism of monetary policy. [2]
1.2 There are different channels or transmission mechanisms of monetary policy. Which of these
transmission mechanisms is the most important? Provide 3 reasons to support your answer.
[5]
1.3 Indicate whether each of the following statements is true (T) or false (F) [13]
1) The government authorities in charge of monetary policy are the central banks.
2) The action of the Reserve Banks in changing the repo rate will cause changes in the
demand-side inflation.
3) Reserve Banks can only conduct open market operations but not influence the reserve
requirement ratio.
4) Money supply is positively related to the amount of excess reserves.
5) The three tools that the South African Reserve Bank (SARB) uses can only be used to
reduce inflation.
6) In a barter economy, transaction costs are relatively low because people need to satisfy
a double coincidence of wants.
7) Money has different primary functions in an economy when money is shells, gold, or
paper.
8) Open Market Operations is not one of the tools that the South African Reserve Bank
(SARB) uses.
9) Financial intermediaries allow small savers and borrowers to benefit from the existence
of financial markets.
10) One solution to the problem of high transaction costs is to bundle the funds of many
investors together so that they can take advantage of economies of scale.
11) The money multiplier tells us how much monetary base changes given a change in the
money supply.
12) Money cannot be referred to as money supply as they have different definitions.
13) The independence of the South African Reserve Bank means that it is unlikely to focus
on the long-term objectives but seeking short-term solutions.
