Question # 1

If personal income equals Rs.570 white personal income takes equal Rs.90 consumption is Rs.430. interest payments total Rs. 10 and personal saving is Rs. 40, disposable income equals.

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Rs. 500

Rs.480

Rs. 470

Rs.400

Ahmed uses dummy variables in order to determine the monthly seasonal effect in her regression model. The number of dummy variables used will be.

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5

11

12

1

The low point in the business cycle is referred to as the

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Expansion

Boom

Trough

Peak

What is the average money balance according to the square root rute if income is Rs.1500, each transaction cost is Rs.4, and the opportunity cost of holding money is.2%

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387

50

175

203

Which of the following changes shifts the SRAS curve up.

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Ani increases in the labor force

A decrease in government purchases

An increase in firms costs

An increase in the money supply

If the expected rate of inflation rose at the same time the natural rate of unemployment rose the Philips curve.

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would shift down

would shift up

Would not move

Might shift up or down or not move depending on which effect was larger.

Which one of the following would cause demand pull inflation.

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Increases iin production costs

Wage gains in proportion productivity gains

An increase in aggregate demand with shortages of sup ply

Monoposonistic labor markets

The data indicates that country A in billions of rupees is experiencing a

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A deficit of Rs.60

A surplus of Rs. 300

Deficit of Rs.900

A deficit of Rs. 500

Which of the following in a graph with interest rates and income on the vertical and horizontal axes, does not shift the balance of payments curve to the right.

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Capital flow restrictions

Export quotas

Export subsidies

Import tariffs

Which of the following macro economic variables is procyclical and coincident with the business cycle.

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Residential investment

Nominal interest rates

Industrial production

Unempolyment

Which of the following does not result in an increase in U.S. autonomous net exports.

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The U.S. dollar depreciated

Major trading partners stimulate their economy

Foreign currencies depreciate

Foreign trading partners lift tariff barriers

Ahmed regression model yields a Durbin Watson d statistic whose value is 0.002. The results indicate.

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Positive serial correlation

the presence of multicollinearity

No serial correlation

Negative serial correlation

If nominal GNP were Rs.1000 ballooning 1976 and Rs.2200 billion in 1986, and the implicit GNP deflator was. 1.2 in 1976 and 1.6 in 1986 concluded that .

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Real GNP increased by approximately Rs. 542 billion from 1976 to 1986

The price level fell from 1976 to 1986

Real GNP increased by 35%

Nominal GNP increased by 80%

When total utility becomes maximum then marginal utility will be.

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Minimum

Average

Zero

Negative

When planned saving equals Rs.40+0.20 Yd and planned investment is rs. 60, the equilibrium level of income in.

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Rs. 100

Rs. 400

Rs.500

Rs.1000

The origin of the idea of a trae off between inflation and unemployment was a 1958 article by

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A.W Philips

Edmund phelps

Milton Friedman

Robert Gordon

The equation for the IS curve is.

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Y = 55 - 50 i

Y = 175 - 75 i

Y = 300 - 100 i

Y = 275 - 25 i

The main cause of cyclical unemployment is that.

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Firms engage in race gender and sex discrimination in their hiring practices.

Some induvial do not have marketable job skills.

the level of overall economic activity fluctuates

Workers offer voluntarily quit a job to look for a better job.

As the economy nears full capacity the short run aggregate supply curve

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Stagflation

Structural inflation

Demand side inflation

Supply side inflation

Suppose your company is in equilibrium will its capital stock at its desired level A permanent increase in the depreciation rate now has what effect on your desired capital stock. i

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Raises it because the future marginal productivity of capital is higher

Lowers it because the future marginal productivity of capital is lower

Raises it because the user cost of capital is now lower

Lowers it beacause the user cost of capital is now higher

A commercial bank has a required reserve ratio of 20% and desires to hold 5% in excess reserves. the bank receives a Rs. 10,000 deposit. It it abides by the required reserve ration and its desire to hold excess reserves the bank can make a loan of a most.

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Rs.7500

Rs.2500

Rs.5000

Rs.30,000

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