Question # 1

The opportunity cost of holding currency decreases when.

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Income decreases

The interest rate on bonds decrease

Buying newly issued government bonds directly from the central bank

Buying newly issued government bonds directly to the central bank.

A price decrease and an increase in income are similar in that

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Both force the consumer to achieve a lower level of well being

Both force the consumer to reach a lower indifference curve

Both move the budget line outward

^{They are not similar at all}

Expansion in money supply stems from.

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Increasing the cost of bank credit

Reducing availability of bank credit

Reducing the financial cost of bank credit

None of above

An item designed as money that is intrinsically worthless could the.

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A currency note

A silver coin

A barter item

Any tradeable commodity

The average total cost of a wedge increases from Rs. 0.79 ro Rs. 0.83 Evidently

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AFC exceeds AVC

MC is between Rs. 0.79 and Rs. 0.83

AVC is Rs. 0.83

MC is greater than Rs. 0.83

To ensure that the fundamental identity of national income accounting holds changes in inventories are.

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Ignored

Counted as consumption

Treated as part of saving

Treated as part of expenditure

A concept which can take on different quantitative values is called a.

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Variables

Control groups

Values

paradigm

If two sets contain the same distinct elements, then they are called.

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Equal sets

Unequal sets

Equivalent sets

All of the above

The very word statistics refers to.

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State craft

Science of state

Political state

Political craft

As long as all prices remain constant an increase in money income results in.

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An increase in the slope of the budget line

A decrease in the slope of the budget line

An increase in the intercept of the budget line.

a decrease in the intercept of the budget line.

Tax collection estimate for year 2012-13 is Rs. _______ billion

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3,234

3150

3.064

None of the above

An increase in expected inflation is likely ot cause.

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A decline in the demand for real balances

an increase in the demand for real balances.

No change i the demand for real balances

No change in the demand for real balances only of the income elasticity of real money demand is zero.

In the cost of slugger rises and slugger is major ingredient in jelly beans then the jelly bean.

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Demand curve shifts to the left

Supply curve shifts to the left

Supply curve shifts to the right

Demand and supply curves both shift to the right

In the Keynesian cross diagram, an expenditure causes the aggregate demand function to shift _________ and the equilibrium level of aggregate output to.

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up ; rise

up ; fall

down ; rise

down ; fall

Less demand in the economy may increase unemployment this may lead to less spending which may reduce demand further This is called.

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The upward accelerator

The downward multiplier

The upward PPF

The downward MPC

Specific tariffs are collected as

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Fixed amount of money per unit traded

a percentage of the price of the product

A percentage of the quantity of imports

All of the above

Real business cycle theories suggest that _____ to correct departures from the desired growth path.

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There is a role of fiscal policy

There is a role for monetary policy

There is a role for supply side policies

There is no case for stabilizing output over the business cycle.

If the % change in quantity demanded is more than % change in price coefficient of price elasticity is.

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>1

<1

=1

=zero

Increased levels of spending on imports

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shift aggregate supply to the right

Shift aggregate supply to the left

Shift aggregate demand to the right

Shift aggregate demand to the left

GDP plus net property income from aboard equals what.

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GNP

NNP

Depreciation

Real GDP

A government might use tax to.

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Discourage consumption of positive externalities

Discourage consumption of public goods

Discourage consumption of merit goods

Discourage consumption of negative externalities

Net National product equals.

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Gross national product minus indirect business taxes

Gross national product minus depreciation

National income minus indirect business taxes

National income pluses depreciation

A straight line diagram can be drawn knowing the _______ and _____

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Vertical axis and horizontal axis

Intercept and slope

Scale and slope

Intercept and scale.

World trade has been increasing due to.

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Increased tariffs

Increased legal barriers

Increased embargoes

Reduced protectionism

The equilibrium level of income of the open economic model is.

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200

400

300

500

Which of the following explains why demand curves slope downward.

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Prices and income

substitutes and complements

Resources and technology

Substitution effect and income effect

If the coefficient of income elasticity is negative.

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Inferior good

Normal good

Luxury good

All of these

Second step in problem formulation is

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Statement of the problem

Understanding the nature of the problem

Survey

Discussions

In pure competition.

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Strong rivaled exist

Cartels are formed

Both a and b

None of thes

A Rs.10 increase in autonomous investment spending shifts is.

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Rightward by Rs. 10

Leftwards by Rs. 10

Rightward by Ke (Rs.10)

Leftward y Ke (Rs.10)

Defined as a tentative or working proposition suggested as a solution to a problem.

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Research

Objective

Hypothesis

Concepts

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