Hello, I am having problems in some of the Eco MCQs of A2. Will be very glad if anyone helps me out here.
I am posting some of the mcqs here. Try to help me out in all of them or at least the ones you can solve.
Oct/Nov paper 31 2010=
18 According to monetarist theory, what will be the short-run and the long-run effect of an
unexpected increase in the money supply on the real wage level?
short-run long-run
A decrease increase
B decrease unchanged
C unchanged increase
D unchanged unchanged
why is the answer B here????
20 In a closed economy with no government
the full employment level of income = $400 billion
and the equilibrium level of income = $380 billion.
If the deflationary gap is $4 billion, what is the marginal propensity to consume?
A 1/5
B 1/4
C 3/4
D 4/5
Why is the answer D here??
22 An increase in the money supply leads to a fall in interest rates. What else will decrease as a
result of these changes?
A the desire to hold idle money balances
B the price of equities
C the price of government bonds
D the velocity of circulation of money
Why is the answer D here??
24 Which feature of the Indian economy could explain why the purchasing power parity exchange
rate of the Rupee is much higher than its market exchange rate?
A high levels of duty on imported goods
B high levels of rural unemployment
C the relatively low price of goods not traded internationally
D the relatively low rate of inflation
Why is the answer C here??
Oct/Nov 09 paper 32 =
Q9. (Sorry couldn't post the question here as it contained a diagram)
Why is the answer D here?
Q15. (Sorry couldn't post the question here as it contained a diagram)
Why is the answer C here?
Q20. (Sorry couldn't post the question here as it contained a diagram)
Why is the answer C here??
Thank you very much. Cheers!
I am posting some of the mcqs here. Try to help me out in all of them or at least the ones you can solve.
Oct/Nov paper 31 2010=
18 According to monetarist theory, what will be the short-run and the long-run effect of an
unexpected increase in the money supply on the real wage level?
short-run long-run
A decrease increase
B decrease unchanged
C unchanged increase
D unchanged unchanged
why is the answer B here????
20 In a closed economy with no government
the full employment level of income = $400 billion
and the equilibrium level of income = $380 billion.
If the deflationary gap is $4 billion, what is the marginal propensity to consume?
A 1/5
B 1/4
C 3/4
D 4/5
Why is the answer D here??
22 An increase in the money supply leads to a fall in interest rates. What else will decrease as a
result of these changes?
A the desire to hold idle money balances
B the price of equities
C the price of government bonds
D the velocity of circulation of money
Why is the answer D here??
24 Which feature of the Indian economy could explain why the purchasing power parity exchange
rate of the Rupee is much higher than its market exchange rate?
A high levels of duty on imported goods
B high levels of rural unemployment
C the relatively low price of goods not traded internationally
D the relatively low rate of inflation
Why is the answer C here??
Oct/Nov 09 paper 32 =
Q9. (Sorry couldn't post the question here as it contained a diagram)
Why is the answer D here?
Q15. (Sorry couldn't post the question here as it contained a diagram)
Why is the answer C here?
Q20. (Sorry couldn't post the question here as it contained a diagram)
Why is the answer C here??
Thank you very much. Cheers!
