Question # 1

The are price elasticity of demand is approximately

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0.3

3.3

6.0

0.2

Which of the following will cause a monetary induced change versus a fiscal induced change in equilibrium income as determined.by IS - LM analysis.

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A shift in the consumption function

A shift in government expenditures

A change in liquidity preference

A change in a government expenditures

What is the significance of underestimating transactions money.

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Monetary policy will be over simulating the economy

Monetary policy will be putting a drag on the economy

there is a need for money that the central bank should be meating.

The economy has too much money and there frore not enough spending.

The long run Philips curve is _________ at the ______

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Horizontal natural rate of inflation

Horizontal , natural rate of unemployment

Vertical , natural rte of inflation

Vertical , equilibrium rate of unemployment.

The current chairperson of the planning commission of Pakistan.

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Nadeem ul Haque

Mehmood ul Haq

Abdul Hafeez sheikh

None of the above

Fiscal policy output to change demand for output is.

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Completely effective in region KL

Partially effective in region JK

Elasticity is infinite for region LT

Completely ineffective in region LT

The asset market approach is most helpful in explaining.

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Why exchange rate remain quite stable

Why government change their money supplies

Long term exchange rate movements

Short term exchange rate movements

"Economics is a science " the basis of this statement is.

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Relation between causes and effect

Use of deductive method and inductive method for the formations of laws

experiments

All of the above

During periods of negative demand shocks deficit target reductions such as those mandated in the Gramm Rudman Hollings Act would tend to.

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Stimulate the economy and increase empolyment.

Result in additional recessionary declines in employment and income

Stimulator defiance spending

Have an automatic stabilizing impact upon the economy

To move from point E to point E1 is consistent with.

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Expectations of a constant price level

Adaptive expectations that have no adjustment for the period immediately following a change in the actual price

Rational expectations and NCM

A and B

Sample implies

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Survey representation of larger whole

Smaller representation of larger whole

Population representation of a larger whole

Census representation of a larger whole

Which of the following solutions does the economist suggest to cost inflation in higher education.

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Cutting professor salaries

Make students live at home

Reduce college from four to three years

B and C

In a perfectly competitive market if firms are earning an economic profit the economic profit.

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Attracts entry by more firms, which lowers the market price

Can be earned both in the short run and long run

Is less than the normal profit

Leads to a decreases in market demand

If the price elasticity of demand for a non giffen good is inelastic are decreased in its price result in.

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Increase in demand

Decrease in demand

Increase in total revenue

Decrease in total revenue

When the price level increases 25% starting from a price level equal to 100, a Rs. 1000 bond will have a real value of .

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Rs. 800

Rs.1250

Rs.750

Rs.666

The rate of which central bank lends to commercial banks is known as

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reserve rate

Discount rate

Open market operation

None

If I keep some money available in case I see a bargain this is an example of.

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Asset demand for money

Transactions demand for money

Token demand for money

Precautionary demand for money

What is the possible cause for a falling real GNP over a period of time.

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A general fall in the value of output though changes in quantities producted.

A general increase in prices

An increase in the value of output produced and a general increase in prices

A, B and C

Which of the following is likely ot be longer for monetary policy that for fiscal policy.

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The implementation lag

The recognition log

Both a and b

None of these

The same graph shows that the firm order to maximize profits , should produce.

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30 units charges a price of Rs. 16

20 Units and charge a price of Rs. 22

35 Units and charge a price of Rs. 12

38 units and charge a price or Rs. 10

A movement along the demand curve may be caused by

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A change in income

A change en the number of buyers

A change in advertising

A shift in supply

The use of money is more efficient than barter because the introduction of money

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Reduces the need for economic specialization

Reduces the need to exchange goods

Reduce the need for other stores of value

Reduces transaction costs

The "Law of demand" states that other things remaining the same the quantity demanded of any good is.

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Directly related to its price

Positively related to its price

Inversely related to its price

Directly elated to the supply of the good

What explains Solow's surprise.

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Diminishing returns to capital

Insufficient assistance to developing countries

Weak institutions

low labor productivity

Floating exchange rates are __ in the short run

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Stable

Volatile

Predictable

Depreciating

The main assumption of Kaldor model is that the economy operates at the level of .

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Full employment

Above than full employment

Less than full emplyment

None of above

As the economy nears full capacity the short run aggregate supply curve

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Stagflation

Structural inflation

Demand side inflation

Supply side inflation

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

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The price level increases by a factor of four

The price level doubles

The price level is unchanged

The price level falls by one half.

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

Aggregate demand without a foreign sector is the sum of.

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c+1

C+G

1+G

C+!+G

A firm's total labor cost when six workers are employed is Rs.580 When seven workers are employed the total labor cost is Rs.700 the Rs. 120 change in total labor cost represents.

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Marginal physical product

Marginal resources cost

Marginal cost

Marginal revenue

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