Question # 1

Disposable incomes is equal to.

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National income Minus taxes

Real GDP

National income Minus taxes

National income Minus Taxes plus transfers

Everyone's absolute income doubles family A's APC, according to the simple Keynesian consumption function is expected to.

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Fall

Double

Increase

Halve

A temporary decrease in government purchases would cause.

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A rightward shift in the saving curve and a leftward shift in the investment curve

A rightward shift in the saving curve and a rightwards shift in the investment curve.

A right ward shift in the saving curve but no shift in the investment curve

No shift in the saving curve but a left ward shift in the investment curve.

Which exchange rate mechanism is intended to insulates the balance of payments from short term capital movements while providing exchange rate stability for commercial transactions.

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Dual exchange rates

Managed floating exchange rates

Adjustable pegged exchange rates

Crawling pegged exchange rates.

The prisoners Dilemma Game demonstrates that.

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Players are better off to act independently

Monopoly is better than competition

People will always cheat

Players are better off if they con operate

The Isoquant curve shows different combinations of two factors of production which give the producer.

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Different level of output

High level of output

low level of output

Same level of output

A decrease in the effective tax rate on capital would cause the IS curve to.

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Shift up and to the right

shift down and to the left

Remain unchanged

Remain unchanged if taxes are fully deducible from income otherwise, shift up and to the right

currency speculation is__________ if speculators bet against market forces that cause exchange fluctuations, thus moderating such fluctuations.

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Destabilizing

Stabilizing

Inflationary

Deflationary

To be productively efficient a firm must produce where

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Marginal costs are maximized

Marginal costs are minimized

Average costs are minimized

Average revenue is maximized

Cardinal approach theory was presented by

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Marshall

Adam smith

Robbins

Hicks

To anticipate what the economy is going to do next the government will look at.

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Lagging indicators

Flashing indicators

Coincidental iindicators

Leading indicators

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

A market demand curve can be derived by adding all the individual demand curves

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Vertically

Horizontally

In parallel

Any of the above as long as it is consistent

When we know the quantity of a product that buyers wish to purchases at each possible price we know.

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Demand

Supply

excess demand

Excess supply

If every element of a raw of column of a square matrix A is zero, then the value of the determinant. is.

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Equal

One

zero

Not equal

As income increases.

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the average propensity to consume gets nearer in value to the marginal propensity to consume

the average propensity to consume diverges in value from the marginal propensity to consume

the average propensity to consume falls

The averge propensity to consume always approaches 0

When IMF was established.

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1944

1945

1946

1947

The supply curve of a perfectly competitive firm

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Includes the upward sloping portion of the marginal cost

Is equal to entire margin cost

Includes the downward sloping portion of marginal cost

None of these

Quotas are government imposed limits on the ________ of goods trade between countries.

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Prices

Quantity

Revenue

Costs

If each element of a raw or column is a sum of two elements, the determinant can be expressed as the

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Sun of two determinants

Difference of two determinants

Multiplication of two determinants

Division of two determinants

____________ represents the difference between what consumers have to pay for a product and what they are willing and able to pay.

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Producer surplus

Deadweight surplus

Government surplus

Consumer surplus

Which of the following events will lead to a decrease in the demand for money.

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An increase in the level of aggregate output.

A decrease in the supply of money

A decrease in the interest rate

a decrease in the price level

An increase in the costs of production will

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Shift demand out wards

Shift demand in wards

Shift supply out wards so more is supplied at each and every price all other things unchanged.

Shift supply inwards

Devaluation of rupee would result into

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Expensive exports

Expensive imports

Expensive labour

Overvalues Rupee

Suppose taht an exise tax is imposed on the monopolist's product if the monopolist's marginal cost is horizontally the relevant range, which of the following statements must be true.

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The price will increase by an amount less than the tax

The price will increase by an amount equal to the tax

The price will increase by a amount greater than tax

The price may either increase or decrease

Real GNP measures income

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Including non market activities

Adjusted for inflation

Including externalities

Including tax evasion

Credit (+) items in the balance of payments correspond to anything that.

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Involves receipts from foreigners

Involves payments to foreigners

Increases the domestic money supply

Decrease the demand for foreign exchange

An asset with zero carrying costs and a present value of Rs.50,000 will return continuous annual yield of Rs.5000 if the current and future rate of inters is.

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5%

8%

10%

3%

A tax increase __________ disposable income ____ consumption expenditure and shifts the IS curve to the.

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Increase; increases ; right

Increase ; decreases ; left

decreases ; increases ; left

decreases ; decreases ; left

The overall Budget Deficit is financed from

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External borrowing

Non bank borrowing domestically

Bank borrowing plus the above two at a and b

None of the above

The commission's authoritative figures include a Chairman who is the_____ assisted by the deputy chairman and a science advisor.

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Prime Minister

President

Chairman Senate

None of these

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