Economics second round model exit exam 2016

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

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

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

4) According to the Life-Cycle hypothesis

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?

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

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

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

9) Which of the following represents trade pessimists?

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

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

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

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

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

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?

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

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

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.

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

20) Oligopolistic industries are characterized by:

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

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

23) Implicit costs are costs :

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

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

26) Which one of the following is not correct

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

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

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

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

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

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

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

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

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

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

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

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?

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?

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?

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

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

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

44) Which of the followings shows surplus trade?

45) Which of the following statements is incorrect?

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

47) Which of the following statements is incorrect?

48) Reasons for using Panel Data doesn’t include

49) For an equation to be identified

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

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

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

53) Which of the following is correct?

54) Which of the following statements is incorrect?

55) Which of the following statements is correct?

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

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

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

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

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

61) Which of the following statements is incorrect?

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

63) Which of the following statements is correct?

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

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

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

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

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

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

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

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

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

73) From the following statement which one is wrong?

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

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

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

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

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

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

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

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

82) Static comparative advantage goods in developing countries

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

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

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

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?

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

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

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 :

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.

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:

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

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

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

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

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

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

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:

99) Which one of the following is correct?

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