Question # 1

What is the effect of imposing a fixed per unit tax on a good on its equilibrium price and quantity.

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Price falls, quantity rises

Price rises, quantity falls

Both price and quantity fall

Both price and quantity rise

Assuming that money is neutral an increase in the nominal money supply would causes.

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An excess supply for goods

an increase in the real money supply

A fall in the price level

A rise in nominal wages

in 1950s following sector was ignored

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Agriculture sector

industrial sector

import sector

Services sector

To be considered a good candidate for an export cartel a commodity should.

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Be a manufactured good

Be a primary product

Have a high price elasticity of supply

Have a low price elasticity of demand

If the price was fixed below the equilibrium price there would be.

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Excess supply

Excess demand

Equilibrium

Down ward pressure on prices

A demand curve shows that relation between price and demand.

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Positive

Negative

Zero

Very strong

Two commodities are considered to be perfect substitutes for each other if the elasticity of substitution is

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Positive

Negative

Infinite

None of these

The economic logic behind granting central bank's independence from governmental the conduct of monetary policy is.

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To eliminate seignior age

To allow open market operations

To enhance the credibility of monetary policy.

None of the above

The expected real interest rate minus expected inflation rate.

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Nominal interest rate minus inflation rate

Nominal interest rate minus expected inflation rate.

Expected nominal interest rate minus inflation rate

Nominal interest rate plus expected inflation rate.

If the columns of a given matrix A and B are changed into rows and vice versa, the matrix thus obtained is called the.

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Symmetric matrix

Transpose of a matrix

Singular matrix

Rank of matrix

Women and non whiles on average receive lower comes than white men because.

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They tend to work in relatively unskilled jobs

Educational disadvantage

Firms are reluctant to invest in training

All of the above

The philippic curve is the relation between inflation and unemployment that hold for a given natural rate of unemployment. and a

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Given rate of inflation

Given expected rate on inflation

Given level of unemployment

Given expected level of unemployment

Projects A,B,C,D,E cost Rs. 100, Rs, 200, Rs. 300, Rs. 400, and Rs. 500 with MEC's of 0.07, 0.06,0.09 ,0.10 and 0.11 respectively. The market rate of interest is 8% Total investment spending is

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Rs. 1500

Rs.1300

Rs.1200

Rs.300

When marginal revenue equals marginal cost

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Total revenue equal total cost

There is the biggest positive difference between total revenue and total cost

there is the biggest negative difference between total revenue and total cost.

Profits are zero

the_____________ analysis considers the ability of domestic and foreign prices to adjust to devaluation in the short run.

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Pass through

Absorption

Adjustment mechanism

currency contract period

The quantity theory of money allows monetarists to obtain a number of economics predictions by assuming a constant.

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Velocity of money

Nominal output

Overall price level

Stock of money

Productive capacity of agricultural sector due to green revolution

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Remain same

Not effectectd

Increased

Decreased

A fall in interest rates is likely to

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Increase aggregate demand

Increase savings

Decrease consumption

Decrease exports

change in quantity demanded

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Downward shift of demand curve

Movement on the same demand curve

Downward shift

None of these

Developing economies usually

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Have large industrialized sectors

Are dependent on primary products

Have high levels of wealth

Earn more from exports than is spent on imports

If A and B are symmetric matrix, then AB- BA is.

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Symmetric

Skew symmetric matrix

Idempotent matrix

Orthogonal matrix

If the price of both goods increase by the same percent , the budget line will.

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shift parallel to the left

Shift parallel to the right

Pivot about the x axis

Pivot about the Y axis

If the Bank of Pakistan wished to pursue an expansionary monetary policy it would.

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Increase the minimum reserve asset ratio

Sell government securities on the open market

Buy government securities on the open market

Raise interest rates.

A reduction in the money supply is likely to

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Reduce interest rates

Increase the interest rate

Increase inflation

Decrease deflation

The short run impact of unanticipated expansionary monetary policy is that.

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Real output decrease

Employment decreases

Real interest rates decrease

Profit margins decrease

An increase in the real wage rate will cause

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The labor demand curve to shift to the right

The labor demand curve to shift to the left

The quantity of labor demanded to rise

A movement along the labor demand curve

The value of an asset depends upon

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Its scrap value

Its depreciation

The present value of the failure stream of income it can earn.

the cost of loans

Immediately after a through we would expect to have al

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Peak

Recession

Recovery

Another trough

In the long run an increase in consumer spending would cause output to ________ and the price level to.___________

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rise;rise

rise; stay; constant

stay constant ; stay constant

Stay constant ; rise

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

Based on the data above , the increase in potential MI would be

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Rs.50 billion

Rs.300 billion

Rs.60 billion

Rs.100 billion

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