Question # 1

When the value of the Rupee rises Pakistan goods become _____ expensive relative to foreign goods which ___ exports.

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more ; iincreases

less ; increases

more ; decreases

more ; increases

import substitution is the replacement of ________ by domestic production under the protection of.

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exports, subsidies

Exports, patents

imports, high tariffs or import quotes

Imports, subsidies

A public good will

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Be underprovided in the free market

Be overprovided in the free market

Not be provided in the free market

Has no opportunity cost

The Marginal cost of product W exhibiting positive externalities is McW = 25 + 5 Qs, the competitive price for each unit of W (Pw) is Rs. 175 and the positive externality is worth Rs. 100 to society for each unit produced. Society considers product W under produced by how many units.

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10 Units

15 Units

20 Units

5 units

The equilibrium level of income is.

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Rs. 360

Rs.600

Rs.440

Rs.500

Satellite television subscription and television detection devices are ways in which broadcasting companies address the _____ problem.

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Externality

Market imperfection

Deadweight burden

Free rider

Which of the following is incorrect with respect to the consumption diagram.

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the interest rate is a premium

MRS = (i +r)

The consumer will be lender in time zero

The consumer lends 700

Secondary activities

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Services

Production

Raw materials

All of these

Inferential statistics is the branch of statistics which helps in inferring.

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Sample value

Population value

Botha a and b

None of these

Using the Keynesian model , the effect of a decrease in the effective tax rate on capital would be to cause_____ in the real interest rate and __ in output in the long run.

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An increase ; no change

A decrease ; no change

An increase ; an increase

No change ; a decrease

The resources in the economy do not include.

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Demand

Land

Labor

Capital

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

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Prices

Quantity

Revenue

Costs

A specification of a maximum amount of a foreign produced good that will be allowed to enter the country over a given time period is referred to as a

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Domestic subsidy

Export subsidy

Import quota

Export quota

Which of the following is the most liquid.

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A savings account

A 6 months CD

A home

Water

The appropriate expenditure switching policy to correct a balance of payments deficit is.

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Contractionary monetary policy

expansionary fiscal policy

Currency devolution

Currency revaluation

In Islamic economic system following means of gaining wealth are permitted

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smuggling

Hoarding

Gambling

None of these

GDP per head may be an imperfect measure of economic welfare because it excludes.

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The value of leisure

Externalities

Untraded goods

All of the above

Saving means

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Part of income for investment

Income for boarding

Non consumption of income in the current period

None of the above

Which school of economic thought suggested that one possible cause of inflation was a push from the cost side.

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New classical economists

Monetarists

Marxists

Keynesians

An increase in money demand other thing equal shifts the ____ curve to the___

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IS ; right

IS ; Left

LM ; Left

LM ; right

A tariff -rate quota

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Is a limit on the number of tariff that a country can place on imports

Uses a single tariff along with import quotas to restrict imports

Is decreased to avoid the price increase caused by simple tariffs

Is a two tier tariff system intended to restrict imports

What is the refers to any collection of specified group of human beings

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Sampling

Random sampling

Non probability sampling

Population

The view which allows only use value ot nature is known as.

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Deep ecology

Shallow ecology

Life ecology

None of these

The term skewness refers to.

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Bulginess

Lack of symmetry

symmetrical

Normal

Under a fixed exchange rate system an expansionary fiscal policy leads to a

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Trade account deficit and a capital account surplus.

Trade account deficit and a capital account deficit

Trade account surplus and a capital account surplus

Trade account surplus and a capital accoundt deficit

An economics variable that moves in the same direction as aggregate economic activity is called.

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Countercyclical

Procyclical

A cyclical

A leading variable

When desired national saving equals desired national investment what market is in equilibrium.

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The goods market

The money market

The foreign exchange market

The stock market

Currency speculations is_________ if speculators bet against market forces that cause exchange functions, thus moderating such fluclutions.

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Destabilizing

Stabilizing

Inflationary

Deflationary

The are price elasticity of demand is approximately

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0.3

3.3

6.0

0.2

Which financial instruments provide a buyer the right to purchase or sell a fixed amount of currency at a prearranged price within a few days to a coupled of years.

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Letter of credit

Foreign currency option

Cable transfer

Bill of exchange

A monetary action consistent with the central bank selling bonds in the open market would be.

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An increase in the reserve ratio

A reduction in the discount rate of interest

An increase in government spending.

a reduction in excise taxes

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