Question # 1

The real money demand doubles while the nominal money supply is unchanged what happens to the price level.

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The price level increase by a factor of four

The price level doubles

The price level is unchanged

The price level falls by one half.

All of the following represent obstacles to LDC development except.

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Resource scarcity

Low level of investment

Low population

Poor infrastructure

The rate of inflation in 1985 was

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3.67%

8.5%

9.77%

3.2%

Assume a cosumer buys 25 units of good X at Rs.8 and 10 units of good Y at Rs. 6 in 1980. If Px = Rs. 6 and Py = Rs. 4 in 1970 the pasasche index is.

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1.14

1.65

1.37

1.47

A_______ is an example of a quota where foreigners hold quota licenses.

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Export quota

Embargo

Auction quota

Tariff quota

"More reliable results can be obtained through sampling method" because.

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Statistical error is low

Saves time

Cost is low

None of the above

International difference in opportunity costs lead to countries acquiring.

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Comparative advantage

High exchange rates

Trade exchange rates

Trade barriers

A normal good can be defined as one which consumers purchase more of as.

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Price fall

Price rise

Income fall

Incomes increase

The fraction of additional current income that a person consumes in the current period is known as the

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Consumption smoothing motive

Consumption deficit

Saving rate

marginal propensity to consume

A checking deposit held at a commercial bank is considered ______ of that bank.

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An asset

Net worth

a liability

Capital

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

Biocentrism comes under

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Life centrism

Ecologism

Anthropocentrism

Materialism

Which of the following would decrease aggregate demand.

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Increased consumption

Increasing export revenue

Increased taxation revenue

Increased investment

In the long term a firm will produce provident the revenue covers.

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Fixed costs

Variable cost

Total costs

Revenue

Which of the following is a function of money

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Medium of exchange

Store of value

Unit of accounting

All of the above

Primary producers maybe labeled as.

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White coliar workers

Pink collar workers

Red collar workers

None of these

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

Micro economics is the study of.

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Economy on the whole

Large units of the economy

Individual units of the economy

General economics

Immediately after a through we would expect to have al

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Peak

Recession

Recovery

Another trough

When the Central Bank initiates actions which will lead to an increase in the supply of money IS -LM models tell us to expect that.

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The interest rate will rise

The interest rate will decline

The price level will not change

Investment will decline

In the balcne of payments, travel and tourism are included int he category of.

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Unilateral transfers

Capital account

Merchandise account

Services account

As the required reserve ratio is decreased the money multiplier.

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Could either increase or decrease

Remains the same as long as banks hold no excess reserves

Increase

Decreases

The arc elasticity formula is used to estimate elasticity when

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The product is thought to be inelastic

The product is thought to be elastic

The demand function is known

There are two observations of price and quantity

The government budget surplus equals

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Government purchases plus transfers

Net government receipts minus government purchases

Government purchases minus net receipts

Government purchases minus transfers.

A benefit to consumers of price discrimination is that

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Some products are produced that would not other wise be produced

Producer surplus increases

Consumer surplus decreases

Firms profits increase

If a monopolist's demand curve is downward sloping and linear, then its total revenue curve must be.

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Identical to the demand curve

A ray from the origin with a slope equal to price

negative sloped with twice the slope of the demand curve

A rising function of output that increases at a decreasing rate , reaches a maximum, then falls.

Which of the following is the second law of gossen.

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Law of equal marginal utility.

Law of equi product

Theory of indifference curve

Law of diminishing marginal utility.

Which of the following is a reason for misuse of statistics.

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data can be manipulated

Figures are convincing

Figures can be used to mislead readers

All of the above

A decrease in the quantity of money supplied shifts the money supply curve to the________ and the equilibrium interest rate

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right ; fall

right ; rises

left ; falls

left ; rises

Silent spring is written by

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Spinoza

Paul Taylor

Arne Naes

Rachel Carison

Investors engage in ____ when they move funds into foreign currencies in order to take advantage of interest rates abroad the are higher than domestic interest rates.

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Currency arbitrage

Interest arbitrage

Short positions

Long positions

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