Question # 1

Comparative advantage is determined by

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Actual difference in labor productivity between countries.

Relative difference in labor productivity between countries.

Both a and b

Neither a nor b

A tax of 17 percent per imported item would be an example of a

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Ad valorem tariff

Specific tariff

effective tariff

Compound tariff

All of the following are types of imperfect competition except

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Monopolistic competition

Oligopoly

Monopoly

Unfair competition

The primary function of a bank is to.

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Control the money supply

Provide notes and coins for trade

Make a profit

Provide a chequeen clearing system.

The concept of carbon credit originated from which one of the following.

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Earth summit rio de jeneiro

Kyoto protocol

Montreal protocol

G-8 summit Helligendamm

Economists use the term utility to mean

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The value of a product before it has been advertised

The satisfaction a consumer obtains from a good or service

any characteristic of a good or service which cannot be measured

The contribution a good or service makes to social welfare

The elasticity of demand for cigarettes by a non smoker is.

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Unitary price elastic

Relatively price elastic

Perfectly price elastic

Perfectly price inelastic

Social welfare is maximized when a hedonistic calculus regulates all human action according to the interventionist liberal

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John Stuart Mill

Thorstein veblen

Milton Frideman

Jeremy Bentham

In the cost of slugger rises and slugger is major ingredient in jelly beans then the jelly bean.

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Demand curve shifts to the left

Supply curve shifts to the left

Supply curve shifts to the right

Demand and supply curves both shift to the right

The reduction or covering of foreign exchange risk is called.

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Hedging

Speculation

Intervention

Arbitrage

If matrix A is matrix of order n x m and B is another matrix of order m x n, then BA will be the matrix of order.

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n x m

m x n

n x n

m x m

As disposable income increases from Rs. 1500 to 2000 , saving increases from minus Rs. 50 to Rs.250 if the relationship between disposable income and saving is linear, the MPC obviously has a value of.

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.6

.8

.4

.2

All of the following are parts of the business cycle except.

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Boom

slump

Recovery

Acceleration

A drop in the price of compact disc shifts the demand curve for prerecord tapes leftward from that you know that compact discs and precorded tapes are.

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Inferior goods

Substitutes

Complements

Normal goods

Most commonly referred indicator of inflation is

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Wholesale price index

Retail price index

Consumer price index

Sensitivity price index

The law of inertia of large numbers means.

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Opposite of the law od statistical regularity.

Same to the law of statistical Regularity

Sample in large numbers create big variations in results.

opposite to the mathematical theory of probability

The relation between M2 and inflation is tighter than the relation between M1 and inflation because.

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M1 is larger than M2

The demand for M2 is more stable

M1 includes more liquid assets the M2

None of the above answers is correct.

The single European Act committed_ governments to a ___ in 1992

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European union, single market

Western European, single currency area

European union, single currency area

Western European, single market

When imports from a higher cost supplier with in customs union replace imports from a lower cost supplier outside the custom union, there exists.

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Trade creation

Trade diversion

Dynamic welfare effects

Comprehensive welfare efffects

According to the efficiency wage model during a recession firms will not reduce real wages because.

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Unions would go on strike reducing profitability

This would reduce worker effort and productivity.

The equilibrium real wage has increased

Legally, they can't

The simplest form of rectangular hyperbola is

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y = 1/x

y = x2

y = x-2

y = x3

Capital, as economists use the term.

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Is the money the firm spends to hire resources

Is money the firm raises from selling stock

Refers to the process by which resources are transformed into useful forms

Refers to things that have already been produced that are in turn used to produce other goods and services.

Despite an expansionary monetary policy an economy experiences a recession the recession could occur in spite of the right ward shift of the LM curve if

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The IS curve shifts left ward

The IS curve shifts right ward

The money supply increase

Taxes are cut

One of the difference between a perfectly competitive fir's long run equilibrium and the long run equilibrium of a monopolistically competitive firm is that

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LMS = MR under perfect competition but not under monopolistic competition

SAC = LAC under perfect competition but not under monopolistic competition

SMC = LMC under perfect competition but not under monopolistic competition

LAC = LMC under perfect competition, but not under monopolistic competition

The intersection of the IS and LM curves captures.

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The equilibrium of the demand and supply sides of the economy

the equivalence of monetary and fiscal policy

Joint equilibrium in the goods and money markets

All of the above

Information that is represented usually as words, not numbers.

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Qualitative data

Quantitative data

Primary data

Scientific data

Nationalization occurs when

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The government bans a product

The government takes control of an industry

the government taxes a product to a raise the price.

The government taxes a product to a raise its price.

An intensive study of particular case is.

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Content analysis

Case study

Research design

intensive study

Indifference curves shows various combinations of.

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One commodity

Two

Three

All of these

Negative taxation refers to.

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Tax rebate

Subsidies

Tax evasion

Tax avoidance

It is appropriate to use the supply and demand model if in a market.

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Everyone is a price taker with full information about the price and quantity of the good.

Firms sell identical products

Costs of trading are low

All of the above

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