Question # 1

"Economics is what economists do " It has been supported by.

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Richard jones

Comte

Gunnar Myrdal

All of the above

A rise in the exchange rate value of the rupee will most likely cause.

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A dollar to be worth less in learns of other currencies.

Imports to decrease

Exports to increase

The balance of payments curve to shift to the left

A rise in the price of bond causes the yield of the bond to.

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Rise

Fall

Remain unchanged

Rise uf ut's a short term bond, fall if it's a long term bond

When aggregate economic activity is declining , the economy is said to be in.

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A contraction

An expansion

A trough

A turning point

If the intercept of the consumption function is 75, and MPS is 0.10 the value of consumption expenditures at Yd = Rs. 5,000 is

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Rs.4,500

Rs. 575

Rs.500

Rs. 4,575

Which of the following actions is an example of expansionary fiscal policy.

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A decrees in welfare payments

A purchase of government scantiest in the open market

A decrease in the Bank rate

A decrease in the corporate profits tax rates

If a Canadian dollar costs 0.75 in terms of U.S. dollars, how much Canadian money would an American need to spend in Canada to get a dollar's worth of U.S. value.

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25$

99$

Rs.1.25

Rs.1.13

The equilibrium level of income of the open economic model is.

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200

400

300

500

A temporary decrease in government purchases would cause.

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A rightward shift in the saving curve and a leftward shift in the investment curve

A rightward shift in the saving curve and a rightwards shift in the investment curve.

A right ward shift in the saving curve but no shift in the investment curve

No shift in the saving curve but a left ward shift in the investment curve.

In the Keynesian model short run equilibrium occurs where

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The IS and LM curves interest

The IS curve LM curve and FE lines intersect

the IS curve intersects the FE line

The LM curve intersects the FE line

If the Nominal GNP of an economy rose from Rs. 5000 to 5500 between 1985 and 1986 while the price index rose from 100 to 110 during the same period real GNP

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Fell by 10% from 1985 to 1986

Rose by 10% from 1985 to 1986

Remained constant from 1985 to 1986

Fell by 1% from 1985 to 1986

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

Expansionary monetary policy

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Tends to lead to an appreciation of nation's currency

Usually has no effect on a currency's exchange value

Tends to lea dto a depreciation of the currencies of other nations

Tends to lead to a depreciation of a nation's currency.

An increase in the real wage rate will cause

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The labor demand curve to shift to the right

The labor demand curve to shift to the left

The quantity of labor demanded to rise

A movement along the labor demand curve

A decline expected future output would cause the IS curve to.

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Shift up and to the right

Shift down and to the left

Remain unchanged

shift up and to the right only if people face borrowing constratints.

"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 equation for the IS curve is.

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Y = 55 - 50 i

Y = 175 - 75 i

Y = 300 - 100 i

Y = 275 - 25 i

If sales are forecasted using an adaptive expectations model where the coefficient of adjustment .2, the sales forecast for 1986 is.

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Rs.260

Rs.244.4

Rs.3.6

Rs.283.6

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.

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

Which of the following events would lead to an increase in the marginal product lf labor for every equantity labor.

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An increase in the real wage

A decrease in the real wage

A favorable supply shock such as a fall in the price of oil

an adverse supply shock such as a reduced supply of raw materials.

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