Question # 1

The costs of inflation are

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Shoe leather costs

Menu costs

Income redistribution

All of the above

A reduction in the money supply is likely to

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Reduce interest rates

Increase the interest rate

Increase inflation

Decrease deflation

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

Silent spring is written by

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Spinoza

Paul Taylor

Arne Naes

Rachel Carison

Which of the following results in an increase in the value of the dollar.

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Interest rates n the united states decrees, ceteris paribus

Interest rates in foreign countries increase, ceteris paribus

Price level in the United States increases, ceteris paribus

Productivity in the united states increases, ceteris paribus

Real business cycle theories suggest that _____ to correct departures from the desired growth path.

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There is a role of fiscal policy

There is a role for monetary policy

There is a role for supply side policies

There is no case for stabilizing output over the business cycle.

The slope of a horizontal line is.

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One

Zero

Three

two

A higher GDP per capita may not mean that the quality of life has really improved because.

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It measures wealth not income

It measures Gross Domestic product

It does not measure the quality of the items produced

it is only measured every five years

Economic development can be achieve through stages, is the theory of.

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Rosenstein Rodan

Leibstein

W.W. Rostow

M.P. Todaro

Which exchange rate system does not require monetary reserves for official exchange rate intervention.

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Floating exchange rates

Pegged exchange rates

Managed floating exchange rates

Dual exchange rates

Two commodities are considered to be perfect substitutes for each other if the elasticity of substitution is

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Positive

Negative

Infinite

None of these

A firm A's break even quantity is.

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10 units

40 units

50 units

30 units

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

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

If the Central Bank wanted to decrease the quantity of money held by the public it would.

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Sell government securities

Buy government securities

Lower the legal reserve requirement

Raise taxes

The resources in the economy do not include.

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Demand

Land

Labor

Capital

A price decrease and an increase in income are similar in that

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Both force the consumer to achieve a lower level of well being

Both force the consumer to reach a lower indifference curve

Both move the budget line outward

^{They are not similar at all}

Transit Trade Agreement between Pakistan and Afghanistan ws signed at Kabul on.

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March 2 , 1962

March 2, 1963

March 2, 1964

March 2, 1965

A profit maximizing monopolist in two separate markets will

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Charge different price according to elasticity

Charged same price

Charged very high price

Charged very low price

How many stock exchanges are there in Pakistan.

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2

3

4

5

Aggregate demand without a foreign sector is the sum of.

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c+1

C+G

1+G

C+!+G

Assuming that money is neutral an increase in the nominal money supply would causes.

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An excess supply for goods

an increase in the real money supply

A fall in the price level

A rise in nominal wages

During periods of rising inflation and rising interest rates we expect the demand for real cash to.

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rise

fall

not change

fluctuate

Riskless transactions to take advantage of profit opportunities due to a price differential or a yield differtial in excess of transaction costs are called.

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Differential actions

Cash transactions

Arbitrage

Forward transactions

If there are 50 firms in a industry each selling 2% of the total sales the concentration ratio is.

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50%

2%

8%

100%

"More reliable results can be obtained through sampling method" because.

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Statistical error is low

Saves time

Cost is low

None of the above

A tariff can________ raise a country's welfare.

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Sometimes

Never

Always

None of these

"Zakat" is a charity on.

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Wealth / income which stays with a Muslim for at least one year

Levied on a Muslim who is sahib e Nisab

Deducted at the rate of 2.5% of the income

All of the above

The money multiple tells us teh ultimate increase in.

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The income level due to an increase in the money base

The money supply due to an increase in the money base.

The money supply due to an increase in the income level

The income level due to an increase in the money supply

A disadvantage of chain weighting is that

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Past inflation rates change whenever the base year changes.

Past growth rates of real GDP change whenever the base year changes.

It causes output growth to slow

The components of real GDP don't sum to real GDP

Fiscal policy refers to.

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The actions of the central bank in controlling the money supply

The government's altitude to taxation

The spending and taxing policies used by the government to influence the economy

The governments regulation of financial intermediaries.

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