Question # 1

The nominal interest rate is 5% and the inflation rate is 2% the real interest rate is.

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2%

3%

7%

4%

In the short run an increase in the quantity of money ______ real GDP and _ the price level.

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increases ; raises

does not change ; lowers

decreases ; raises

decrease ; lowers

Fiscal defect in the budget means.

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Revenue Deficit plus the net borrowings of the government.

Budgetary deficit plus the net borrowings of the government

Capital deficit plus revenue deficit

Primacy deficit minus capital deficit

Any combination of products inside the production possibility frontier is

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Allocatively inefficient

X inefficient

Consumer inefficient

Productively inefficient

An indifference curve shows various combinations to goods Which gives the consumer.

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Equal level of utility

Low level of utility

High level of utility

None of these

An allocation is Pareto efficient if no reallocation of resources would make some people_______ whiteout making others

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Worse off, worse off

better off, better off

better off, worse off

equal , unequal

When due to change in price of commodity x demand of commodity y is charged it is called.

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Income elasticity

Price elasticity

More elastic

Cross elasticity

Aggregate demand without a foreign sector is the sum of.

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c+1

C+G

1+G

C+!+G

In a market system sellers act in ___ interest, but this leads to behaviors in ___ interest.

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Self : self

Self ; society's

Society's ; society's

society's, self

Actual equilibrium is Rs. 1,500 billion and full employment is Rs. 2,500 MPC = 0.75 taxes are zero , and prices are adjustable To eliminate the observed deflationary gap , the government should.

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Increase G by Rs.1,000

Decrease G by Rs.250

Increase G by less than Rs.100

Decrease G by more than Rs.250 but less than Rs.1000

The equation for a givne production function is Q = K2 + KL, initially K = 2 and L = 1 if the value of both inputs is doubted the production function exhibite.

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Increasing returns to scale

Diseconomies of scale

Constant returns to scale

Economies of scale

Economics assumes that people consume goods and services to achieve.

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Status

Prestige

Utility

Self esteem

Research is directed towards the solution of immediate , specific and practical problem is called.

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Basic

Applied

Diagnostic

Descriptive

The Root Mean square Error for the actual sales and sales forecast for 1985 and 1986 is.

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20.2

19.9

14.7

17.2

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 sacrifice involved when you choose a particular course of action is called the

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Alterative

Opportunity cost

Consumer cost

Producer cost

In an economy, measuring total value (1) added, total value(2) spending on final goods and 3 total factor earning gives the result that.

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3>2>1

3 +2>1

3<2<1

Any measure can be larger or smaller than any other

Observation ,t he observer have been old specifically what is to be observed.

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Structured

Discussed

Controlled

Participated

Which of the following correct about firms in an oligopoly.

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Each firm has complete control over its own selling price

All firms independently charge monopoly prices

No one firm controls price but each has an influence on the price

There is no competition in oligopoly industries

When total utility becomes maximum then marginal utility will be.

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Minimum

Average

Zero

Negative

Potential output can be increased by _________ or by_________

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Increasing the use of labour, increasing the use of land

Increasing the use of capital, increasing the use of labour

Increasing the use of land, increasing the use of capital

Increasing the use of all inputs technical advances

On a graph a positive linear relation ship.

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Moves down to the right

Moves up to the left

Moves up to the right

Modes down to the left

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

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Expansion

Boom

Trough

Peak

Which skills are most likely to be paid for by the employer.

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General skills

Specific skills

Educational skills

None of these

Which is refers to any collection of specified group of human beings.

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Sampling

Random sampling

Non probability sampling

Population

Wassily Leontief used an input output table in order to test the.

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Richardian theory of comparative advantage

Heckscher Ohlin theory of comparative advantage.

Linder theory of overlapping demand

All of the above

In _________ the government replaced the development board with a new autonomous body called the planning board.

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1951

1952

1953

none of the above

The least common type of transaction in the foreign exchanges is a.

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Forward transaction

Spot transaction

Swap transaction

None of the above

Object of case study is to.

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Gueralise theory

Datives theory

Expand theory

Flexible data collection

A depreciation of currency occur when

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The value of the currency falls

The value of the currency increases

Inflation falls

The balance of payments improves

O kun's Law states that for each percentage point by which the unemployment rate is above the natural rate real GNP is 3% below potential GNP, if real GNP is Rs. 3,800 billion with the actual level of unemployment at 6.05 and the natural rate of unemployment at 4.5% then according to Okun's law the GNP gap is.

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171 billion

684 billion

114 billion

228 billion

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