Question # 1

When a British pound equals Rs. 1.60 and the French France equals Rs. 0.40 the ability to earn infinite profit if it were not the case, implies that the exchange rate would be.

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1 franc = 4 pounds

1 franc = 1 pound

5 franc = 1 pound

None of the above

In perfect price discrimination

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Consumer surplus is maximized

Produce surplus is zero

Community surplus is maximized

Consumer surplus is zero

A square matrix a such that A2 = a is called.

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Orthogonal matrix

Skew symmetric matrix

Idempotent matrix

Singular matrix

When Daimler Benz maker of the Mercedes bought Chrysler the merger was

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Horizontal

Vertical

Conglomerate

None of these

In the long run in perfect competition

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Price = average= cost = marginal cost

Price = average cost = total cost

The price covers fixed cost

total revenue = total variable cost

Which of the following is most likely to benefit a debtor.

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Un anticipated deflation

Anticipated deflation

Unanticipated inflation

anticipated inflation

If the Federal reserve conducts open market ________ the money supply _______ shifting the LM curve to the right.

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Purchases ; decreases

sales ; increases

purchases ; increases

sales ; decreases

Starting from a position where the nation's money demand equals the money supply and its balance of payments is it equilibrium, economic theory suggest that the nation's balance of payments would more into a surplus position if there occurred in the nation a.

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Decrease in the money supply

Increase in the money supply

Decrease in the money demand

any of the above

The earliest statement of the principle of comparative advantage is associated with.

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Adam Smith

David Ricardo

Eli Heckshcer

Berti Ohlin

Which of the following in a graph with interest rates and income on the vertical and horizontal axes, does not shift the balance of payments curve to the right.

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Capital flow restrictions

Export quotas

Export subsidies

Import tariffs

If both supply and demand for a good increase at the same time which of the following must also increase

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The equilibrium price

The use of substitutes

The equilibrium quantity

All of the above

An independent assessment of the impact of firm's activities on society is called a.

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Financial audit

Balance sheet

Profit and uses account

Social audit

The most frequently occurring score in a distribution

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Mean

mode

Median

Quartile

Which of the following is not involved with fiscal policy.

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Income tax

National insurance

VAT

Interest rates

Hyperinflation occurs when

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The inflation rate rises

The inflation Tate declines

The inflation rate is extremely high

The inflation rate is extremely low

In order of practice price discrimination which of the following is needed.

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Some degree of monopoly power

An ability to separate the market

An ability to prevent reselling

All of the above

Which of the following best defines price discrimination.

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Charging different prices on the basis of race

Charging different prices for goods with different costs of production

Charging different prices based on cost of service differences.

Selling a certain product of given quality and cost per unit at different prices to different buyers

The abolition of income tax would probably ________ the number of workers in employment and____________ the equilibrium. rate of unemployment.

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increase ; decrease

increase ; increase

reduce ; increase

reduce ; reduce

According to Keynesians the primary source of business cycle fluctuation is.

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Aggregate demand shocks

Productivity shocks

Oil price shocks

Consumer confidence shocks

Free trade is based on the principle of

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Comparative advantage

Comparative scale

Economics of advantage

Production possibility advantage

the purpose of research is to discover answer to questions through application of.

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Scientific method

scientific research

Scientia procedure

Social science research

In the home country government grants a subsidy of a domestically produced good domestic producers tend to.

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Capture the entire subsidy in the form of higher profits

Increase their level of production

Reduce wages paid to domestic workers

Consider the subsidy as an increase in production cost

In Pakistan income tax is

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progressive tax

Proportional

Direct

A and c of above

The Keynesian model is a good guide to ______ behavior and the classical model describes behavior in.

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^{Long run, short run}

Flexible, imperfect markets

Short term , long run

Ong run, imperfect market.

The Marxist concept of surplus value would not include income received in the form of

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wages

rent

Interest

corporate profit

Environmentalist speak of wilderness as a.

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Animal hertage

Moralists heritage

Environmental heritage

World heritage

The value of real GDP in the current year equals.

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The value of current year output in prices of the base year

The value of current year output in pries of the current year

The value of base year output in prices of the base year

The value of base year output in prices of the current year

The quantity theory of money allows monetarists to obtain a number of economics predictions by assuming a constant.

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Velocity of money

Nominal output

Overall price level

Stock of money

The negative relation ship between unemployment and inflation is know as the

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Aggregate supply curve

Aggregate demand curve

Philipps curve

Efficiency wage line

Total utility of a commodity is measured by which price of that commodity.

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Value in use.

Value in exchange

Both of above

None of above

A negatively sloped isoquant implies

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Products with negative marginal utilities

Products with positive marginal utilities

Inputs with negative marginal products

Inputs with positive marginal products

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