Question # 1

In the money market a condition of excess supply of money cna be eliminated by a _________ in aggregate output or a __ in the interest rate , both of which increase the quantity of money demanded.

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rise ; rise

rise ; fall

fall ; rise

fall ; fall

Major drawback to research ears in Pakistan is

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Lack of sufficient number of Universities

Lack of sufficient research guides

Lack of sufficient fund

Lac of scientific training in research

The conjecture that inequality first increases with development then decreases with further development has been

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Strongly supported by most studies

Supported mainly by cross section not time series studies.

Supported mainly by time sereis not cross section studies

Generally repudiated by empirical studies.

The Hecksher Ohlin theory explains comparative advantage as the result of difference in countries.

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Relative abundance of various resources.

Relative costs of labor

Economies of large scale production.

Research and development expenditures.

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

Which stage guides from the planning stage to the stag of drawing of final conclusions.

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Numerical facts

Statistical methods

Data

None of the above

The central bank and the government are working against each other if as the government cuts taxes the central bank

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Sells government bonds

Lowers the discount rate

Increase the money supply

Decrease the legal reserve requirements

The parable of Riding a Switchback suggests that stabilizing policy.

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Is not sufficiently stimulating or contra citing the economy at any time

Is desirable

Is effective

Is stimulating or contracting the economy at the wrong times.

The fifth five year plan was an attempt to stabilize the economy and improve the standard to living of the poorest segment of the population from __________ to ____

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1975-80

1980--85

1978-83

None of the above

In a market system sellers act in ___ interest, but this leads to behaviors in ___ interest.

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Self : self

Self ; society's

Society's ; society's

society's, self

Import substitution is an example of

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The principle of comparative advantage

The pricnipal of absolute advantage

An outward looking growth strategy

An inward looking growth strategy

According to factor price equalization theorem the ______ factor should oppose free trade policies in any given country.

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Abundant

Scarce

Neither

Can't tell without more information

Duopoly is a market situation when there is

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Single seller

Many seller

Two seller

Few seller

In monopsony there is

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Single seller

Two buyers

Single buyer

Few buyer

Pakistan to get ________ of gas from Pak iran Gas pipeline Turkmenistan -Afghanistan , Pakistan , India gas pipeline.

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1.5 billion cubic feet

2 billion cubic feet

2.5 billion cubic feet

3 billion cubic feet

The percentage change in the quantity demanded in response to a percentage change in the price is known as the.

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slope of the demand curve

Excess demand

Price elasticity of demand

All of the above

Short run equilibrium output means that aggregate demand _ actual output

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is less than

equals

is greater than

fluctuates around

Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a ____ shift of the _____ curve.

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Left ward ; LM

Right ; LM

Left ward ; IS

Left ward ; AD

At point of satiety marginal utilityis.

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Positive

Negative

Maximum

Zero

Which of the following is likely ot be longer for monetary policy that for fiscal policy.

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The implementation lag

The recognition log

Both a and b

None of these

While -Collar work force is categorized as

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Secondary production

Tertiary production

Quarterly services.

None of these

We cannot say whether one allocation of resources is better than another allocation because.

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some people cant count

Some people may not be permanent residents

Not all economic activity is legal

We cant make value judgements to compare different people welfare.

Policy of nationalization was adopted in the period of.

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Z.A. Bhutto

Nawaz Sharif

Zia ul Haq

All of them

A government might use tax to.

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Discourage consumption of positive externalities

Discourage consumption of public goods

Discourage consumption of merit goods

Discourage consumption of negative externalities

The effect of a tax to offset a negative eternality will be to ________ price and ____ quantity.

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Reduce, reduce

increase, increase

Increase , reduce

reduce, increase

MRSxy being 6 means

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Consumer is willing to give up 6 units of x for one of y

Preference for y is 6 times that of x

Both of the above

None of these

A competitive equilibrium is Pareto efficient because.

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Producers are price takers

Consumers and producer's face the same prices

Marginal costs and benefits are equal

All of the above

Statistics are affected to a market extend by

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Aggregate of facts

Multiplicity of causes

Numerically stated

Complex manifestations

The short run Philips curve can shift in response to changes in

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inflationary expectations

Unemployment

The inflation rate

Wage rates

The first level of output at which the long run average costs are minimized is called.

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The minimum Efficient Scale

The minimum External scale

The Maximum External scale

The maximum Effective scale.

In the ISLM framework the decreasing investment spending believed by Keynes to be the cause of the Great Depression would be illustrated by a shift of the ____ curve to the.

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IS ;right

IS ;Left

LM ; Left

LM ; Right

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