Economics second round model exit exam 2016

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Economics second round model exit exam 2016

Choose the best answer

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1) A macroeconomic policy is said to be conducted by rule if policymakers:

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2) Which of the following statements is necessarily incorrect about AK endogenous growth model?

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3) Which one of the investment theory shows the linkage between fluctuation in investment and stock markets

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4) According to the Life-Cycle hypothesis

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5) If the monetary base is $500 billion, the reserve deposit ratio is 0.1 and currency-deposit ratio is 0.6; what will be the money multiplier and the money supply respectively?

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6) _____________is the purchase and sale of government securities by the central bank to maintain the proper level of money supply in the economy.

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7) According to Keynes the Motive for people to hold money as a cushion against an unexpected need is called

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8) Which of the following countries have greater balance of payment?

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9) Which of the following represents trade pessimists?

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10) Pick a region of the world among which the life expectancy is relatively highest

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11) One of the following factors inversely affects the demand for education

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12) Which of the following is not economic cost of corruption?

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13) Which of the following is not causes of inequality?

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14) Which of the following is false according to Lewis model regarding traditional sector?

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15) The physical quality of life index (PQLI) is an aggregation of widely available indicators of basic human needs. Which of the following is not a component of the PQLI?

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16) Non-traded goods do not enter measured GDP because

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17) A ________ occurs if all players in a game play their best strategies regardless of what their competitors do.

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18) The general equilibrium of production occurs at a point where the _________ is the same for all the firms, that is, at a point which satisfies the Pareto Optimality criterion of efficiency in factor substitution.

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19) A profit-maximizing firm hires labor up to the point where

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20) Oligopolistic industries are characterized by:

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21) When comparing monopolistic competition and perfect competition markets, which of the following is true?

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22) The following is incorrect about the relationship between MC, AVC and ATC curves

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23) Implicit costs are costs :

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24) A form of oligopoly in which a dominant firm sets the price and all smaller firms in the industry follow the dominant firm’s pricing policy is called

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25) According to the balanced growth theory, underdevelopment would be solved by

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26) Which one of the following is not correct

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27) The type of monopoly that was created due to efficiency in producing certain product

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28) Which of the following is not the possible sources of monopoly?

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29) Under perfectly competitive market in long run, equilibrium condition for firms will be:

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30) In TR-TC approach, firms in perfectly competitive market get positive profit at the point where;

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31) Identify correct statement about the assumption of perfectly competitive market structure

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32) Given the supply and demand functions for two related goods, tea and coffee,
Q_d^t=30-8P_t+2P_c , Q_S^t=-15+2P_t
〖 Q〗_d^c=28+4P_t-6P_C , Q_S^C=12+2P_C
Where〖 Q〗_d^t,〖 Q〗_d^c, Q_S^t, Q_(S,)^C P_t and P_c represented quantity demand for tea and coffee, supply of tea and coffee, price of tea and coffee respectively. What is the equilibrium price of tea

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33) Given the supply and demand functions for two related goods, tea and coffee,

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34) Which one of the following represent the solution of difference equation x_(t+1)=1⁄2 x_t+3

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35) Which one of the following is the general solution of differential equation (x ) ̇+2x=8

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36) Given demand function p=30-4Q , what is consumer surplus at Q=5

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37) The derivative of multivariate function y=x_1^2 x_2 , where x_1=t^2 and x_2=3t-1 is

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38) Suppose that m=100-200t+250t^2, where m is import and t is tariff. Using differential approximation what is the change in import if the initial tariff rate is 0.2 and it is scheduled to rise to 0.25?

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39) Given production and constraint functions Q=L^.25 K^0.75 and 2X_1+4X_2=100 respectively , what is the amount of labor and capital which maximize the above production function?

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40) Consider production function Q=300√L -4L . where Q denotes output and L denotes the size of work force , what is the value of 〖MP〗_L when L=9?

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41) According to _______________ the SRAS & LRAS curves differ because of temporary misperceptions about prices.

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42) A curve which plots the relationship between equilibrium interest rate and income in money market is

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43) Which one is the link variable between goods market and money market in IS- LM model?

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44) Which of the followings shows surplus trade?

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45) Which of the following statements is incorrect?

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46) Which of the following is true regarding aggregate demand curve?

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47) Which of the following statements is incorrect?

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48) Reasons for using Panel Data doesn’t include

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49) For an equation to be identified

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50) Which of the following is incorrect about simultaneous equation model?

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51) If the trend in a time series is completely predictable and not variable, we call it

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52) which of the followings is not among problems of linear probability model:

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53) Which of the following is correct?

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54) Which of the following statements is incorrect?

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55) Which of the following statements is correct?

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56) ________________ analysis is concerned with describing and explaining the relationship between an explained variable and one or more of the explanatory variables.

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57) Which one is equal to explained variation divided by total variation?

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58) Consider the equation, y = α+β1×1 + β2X2 + u. null hypothesis, H0: β2 = 0 states that:

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59) Which of the following is among rules of thumb to address the problem of multicollinearity?

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60) Which of the followings might not reasons why variances of may be variable?

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61) Which of the following statements is incorrect?

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62) Which of the following is incorrect statement regarding classical linear regression model assumptions?

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63) Which of the following statements is correct?

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64) All of the following statements are considered correct under absorption approach, except:

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65) _____an economic term for the negative consequences that can arise from the spike in the value of a nation’s currency

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66) Which one of the following is not an obstacle for international macroeconomic coordination:

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67) From the following one is not categorized under expenditure switching policy:

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68) Which of the following is a disadvantage of a fixed exchange rate system?

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69) The Marshall-Lerner condition states that a currency depreciation will improve a country’s trade balance if:

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70) The J-curve effect refers to the idea that:

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71) From the following one does not describe the function of commercial banks in FORX market:

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72) From the following which one is the ultimate goal of monetary policy.

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73) From the following statement which one is wrong?

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74) Which of the following is not an asset of central bank?

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75) Which of the following is incorrect regarding Keynesian demand for money?

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76) Which of the following is incorrect about classical theory of money?

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77) Which of the following is the advantage of financial intermediaries?

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78) The process of indirect finance using financial intermediaries is known as?

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79) Which of the following is incorrect about equity (common stock) and debt holder?

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80) Which one is not Activities and responsibilities of Central Banks?

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81) According to the Heckscher-Ohlin model, a country that is relatively abundant in capital will tend to:

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82) Static comparative advantage goods in developing countries

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83) The form of economic integration in which the member nations eliminate tariffs on trade among themselves, adopt a common external tariff wall. and allow for the free movement of labor and capital within the union is the

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84) If a good is imported into (large) country H from country F, then the imposition of a tariff in country H

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85) Intra-industry trade can be explained in part by:

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86) Which trade theory suggests that a newly produced good, once exported, could ultimately end up being imported as the technology is transferred to lower-cost nations?

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87) Which of the following is an example of a regional trade agreement?

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88) Which of the following is an example of a comparative advantage?

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89) process of seeing what changes in the value of the dep’t variable is consequent on a change in the value of one or more of the variables in project analysis is :

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90) An increase in the net working capital in a project corresponds a cash outflow to be financed. In project analysis costs are easier to identify or value than project benefits.

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91) Suppose you are some type investor and submitted your investment to Ethiopian investment commission, and then a team of investment commissioners started to analyze your proposal. Hence this stage is:

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92) Which one of the following is a micro level source of a project:

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93) If a project involves improvement in several non-monetary dimensions, we use which method?

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94) In economic analysis, we cannot use market price to value the economic worth of projects, because of the following reasons, except?

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95) Ex-post evaluation involves the following, except?

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96) Which one of the following statement is true regarding monitoring and evaluation?

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97) The line joining the different points of consumer’s equilibrium resulting from the change only in the price of the commodity is called

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98) Assume a budget line is drawn for two commodities: X on the x-axis and Y on the y-axis. If the income of the consumer is 100 Birr, the y-intercept is 4, and the slope of the budget line is 2 in absolute value, the price of commodity Y is:

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99) Which one of the following is correct?

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100) In a single commodity case; If MUX > Px, how will the consumer react?

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