Question # 1

If the expected inflation rate is unchanged a fall in the natural rate of unemployment would.

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shift the Phillips curve to the right

Not Shift the phillips curve

Shift the Phillips curve to the left

shift the Phillips curve to the left shift the long -run Philips curve to the right

In market economics the incentive that draws entrepreneurs into industry is.

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Government bonuses for meeting production quotas

Profit

Government assumption of the risk of failure

Government assistance with making output and pricing decisions

During inflation.

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Lenders lose borrowers gain.

Borrowers lose , lenders gain

The real interest rate rises

Borrowers and lenders both lose.

A nation experience external balance if it achieves.

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No net changes in its international gold stocks

Productivity levels equal to those of its trading partners

An increases in its money supply equal to increases overseas

Equilibrium in its balance of payments

Two independent variables are not independent of each other in a multiple regression problem The analyst most likely will be confronted with.

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The problem of autocorrelation

A type 1 error

The problem of multicollinear rarity.

a type II error

Find the revenue the government collects as a result of the tax

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Rs.10 million

Rs.40 million

Rs.16 million

Rs.30 million

Economists use the phrase ceteris paribus to express the assumption.

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All else equal

Everything affects everything else.

Scarcity is a fact of life

There is no such thing as a free lunch

The monetary base in composed of.

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Gold and silver

Currency only

Currency and reserves

Currency and checkable deposits

Which of the following macro economic variables is the most seasonally pro cyclical.

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Expenditure on services

The unemployment rate

Expenditure on durable goods

The real wage

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

"Human Welfare is the subject of Economics" Y. This statement is associated with the name of which of the economists.

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Marshall

Pigou

Pension

All of the above

Deflation occurs only when

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Some prices fall but average prices still rise

All prices for all goods fall

The average price level falls

The average price level increases bat at a slower rate than before

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

A situation in which expansionary in monetary policy has no effect on the economy is known as.

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Macro economic stabilization

A liquidity trap

A depression

Capital flight

An increase in the number of workers hired by a firm could result from

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a decrease in the marginal product of labor

a decrease in the marginal revenue product of labor

An increase in the real wage

A decrease in the real wage

Friedman and phelps suggested that there should not be a stable relationship between inflation and unemployment, but here should be a stable relationship between

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Anticipated inflation and frictional unemployment

Anticipated inflation and cyclical unemployment

Unanticipated inflation and frictional unemployment.

Unanticipated inflation and cyclical unemployment

Given a proportional income tax and a government budget that is currently in balance, an increase in autonomous investment , caters parabasal increases equilibrium income and the budget.

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Romaic's in balnce

Has a surplus

Has a deficit

None of these

Country A 's GNP is increasing by 3% a year in contrast to its population growth of 2.4% The rate of growth of per capita GNP is.

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3%

0.85

0.6%

2.4%

The aggregate demand curve shows the combinations of output and the price level that put the economy on.

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The FE line and the IS curve

The FE line The IS curve and the LM curve

The IS curve

The IS curve and the LM curve

"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

The three main components of the aggregate demand aggregate supply model include.

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AD, SRAS, LM

SRAS, LRAS, IS

AD, IS, LM

AD, SRAS, LRAS

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