ECONOMICS
PAPER II

Note This paper contains fifty objective type questions of tto marks each. All questions are compulsory.

1 In which one of the following market situations are the firms mutually interdependent in pricing and output decisions

Oligopoly Monopsony


Monopoly Monopolistic Competition


2 "Value and Capital" is written by who among the following economists
Hanson Philipes Ursula J.R. Hicks
3 Giffen paradox occurs when income effect is

Greater than the substitution effect


Equal to the substitution effect


Less than the substitution effect


Negative and is greater than the substitution effect


4 Which one of the following curves will respond the supply curve of labour

Marginal product curve of labour


Marginal revenue product curve of labour


Value of marginal product curve of labour


Average product curve of labour


5 Limit price refers to the

Price which maximizes the profits of the firm


Price which prevents entry of new firms


Price at which firm just starts earning a surplus over cost


Maximum price which the firm is allowed to charge

6 General Pareto Optimality exists where
XY AB
MRTS =MRTS MRT XY MRS MRS
LK LK XYXY
L K MPP
MRTS =MRTS L L
XY XY MPKPK
7 Advertisement is common in which of the following markets
Oligopoly Perfect Competition
Monopolistic Competition Monopoly
Choose from the codes below

and and Only Only
8 Intellectual property rights regime is managed by
IMF W.T.O. European Union SAARC
9 Which of the following statements are true for a Euro currency market Answer from the codes below

Its existence affects the effective conduct of monetary policy.


It is a highly regulated market.


Codes

Both and are true Neither nor is true


Only is true Only is true


10 According to Heckscher -ohlin theorem, a nation will export a commodity which is

Intensive in its relatively abundant factor


Intensive in its relatively cheap factor


Both and are necessary


Neither nor in necessary

11 Customs union always leads to Trade diversion effect alone Trade creation effect alone Both trade creation and trade diversion effects Neither trade diversion nor trade creation effect
12 Which one of the following assumptions is the most important assumption in the Heckscher ohlin theorem of international trade
Two factor model No tariff Two commodities Constant tariff
13 In dual gap model, the two gaps refer to Inflationary gap and investment gap Saving gap and deflationary gap Savings constraint and foreign exchange constraint Investment gap and savings gap
14 What is the value of the Gini coefficient for an income distribution characterised by complete equality incomes Zero 0.5 1 o (infinity)
1s Which of the following has not been identified as a potential consequence of global warming A fall in agricultural yields The spread of disease The use of nuclear energy A rise in sea levels
16 Assertion Reason Codes One of the characteristics of many underdeveloped countries is that they have a low saving rate and low capital formulation. In underdeveloped countries this is mainly due to high level of consumption.
Both and are true and is the correct explanation of Both and are true but is not the correct explanation of is true but is false is false but is true

17 Concept of 'surplus value' is developed by who among the following economists

J. Schumpeter Karl Marx J.R. Hicks R.A. Fisher
18 Monetary policy is most effective when investment spending is

Interest elastic and demand for money is also interest elastic


Interest inelastic and demand for money is also interest inelastic


Interest inelastic and demand for money is interest elastic


Interest elastic and the demand for money is interest inelastic


19 Slope of the LM Curve depends upon which of the following

Interest elasticity of investment


Interest elasticity of income


Interest elasticity of demand for money


None of the above


20 In a closed economy and three sector model which of the following is true

Household savings equal net investment


Household savings equal gross investment


Household savings plus depreciation equals gross investment plus government spending


Household savings plus taxes plus depreciation equals gross investment plus government spending


21 According to Keynes, the marginal efficiency of capital is the expected

Rate of return on financial assets


Profit from real investment


Profit from financial investment


Rate of return on real investment

22 In the classical macro system, money determines


Employment Real output


Both and Neither nor


Y LM
rate of interest
A r0
LM1
Cr2 IS
r1
X
O Y1 out put

On the conventional IS LM diagram, LM curve shifts to LM1. Then which of the following statements are true

Liquidity effect is rO r1 Liquidity effect is rO r2


Liquidity effect is r2 r1 None of the above


24 Consider the following statements about Phillips curve

There is inverse relationship between rate of inflation and rate of unemployment.


Economic behaviour is a function of nominal returns.


Economic behaviour is a function of real returns.
Of these statements which are true from the Monetarists point of view


All the above are true Only and are true


Only is true Only is true

2s An interest rate risk means When borrowers fail to fulfil the terms of the loan contract A rise in interest rate will mean a fall in the value of security in the secondary market A rise in interest rate will raise the value of financial security in the secondary market When unintended inflation arises
26 In the classical macro system money determines which of the following Output and Prices Employment and Prices Output and Employment Prices
27 When nominal GDP is . 11,000 crores and real GDP is . 10,000 crores, GDP deflator is 9.09 90.91 1.11 110
28 Assertion India has a big potential demographic dividend. Reason India's population growth rate is declining. Codes Both and are correct and is the correct explanation of is correct but is not correct Both and are correct but is not the correct explanation of is correct but is incorrect
29 Recently the base year for calculating GDP in India has been changed to 2009 -10 2011 -12 2014 -15 2004 -05

J-011s llllllllllllll11l 12 Paper-II

2s .r U ff"i cf mrf


0 Ucf f Brf% cf+ f m cf U f ifr *B1f Um f m-r


.r U ifr cf mrf rm fcf f& +rcf 0 U ifr f%t mnf i f r fr cff i r ifr f U %2U m f


.r U ifr f& +rcf 0 U ifr f%t mnf i f r fr cff i r ifr cf fU


0 fimfn i n 1f+f 0 m­


26 F fBcf+r Bif.2U f cf r ifr i n U Fr f ff U fcfr

. m cf+i fr U f U cf+i fr


U f U m cf+i fr


27 0 i ncf Bcf fU m 11,000 cf U f U f%cf Bcf fU m 10,000 cf U f 0 Bcf fU m 1f+f cf Ucf
9.09 90.91 1.11 110
28 .f.. i U ifr rfcfcf+ i r cf+ .r mcf Bri m­ n i U cf+ Br.r U ifr cfi+ Um+ m­

U f fr B r m-r U cf+ Bm+ .r .r m­


B r m U. U r m­


U f fr B r m U. cf+ Bm+ .r .r m+r m­


B r m U. r m­


29 m ifr i U ifr Bcf fU m cf+ T cf U f cff f U f cf f f A B U mf U%f f fcfr r
2009 -10 2011 -12 2014 -15 2004 -05
J-011s llllllllllllll11l 13 Paper-II

30 Which of the following states has the largest share in the total food grains produced in India
Punjab U.P. Haryana M.P.
31 JAM trinity means

Jan -Dhan Account Money


Jan, Awas, Money


Jan -Dhan Yojana, Aadhar, Mobile Numbers


Jyoti, Aadhar, Mobile


32 Who is the originator of 'Buddhist Economics'

Lee Kuan Yew(2) Dalai Lama


E.F. Schumacher Shinzo Abe


33 Which of the following is not a credit rating agency

Moody Standard and Poor


Fitch Nasdaq


34 Which of the following is not used to measure inflation

Whole Sale Price Index Number Consumer Price Index Number


Purchasing Power Parity Prices GDP Deflator


3s Which one of the following pairs is not correctly matched

Similarly placed persons should be taxed similarly -Horizontal equity


Interest payments are deducted from fiscal deficit -Primary deficit


Goods which are divisible and principle of exclusion -Pure private goods applies in full measure


Tax on goods and services is levied according to item's -State excise duties value


J-011s llllllllllllll11l 14 Paper-II

30 f A f f" ifr Bf fcfB U .r cf+ i U ifr c f " . . m ifr B0Bf fm Bf

mr 0 .t U mn f mf Ur T mn f
31 II f. . i.11 f Bf Fr mrf " r f i f0 A0 U .r ff i f0
32 I0 f f 1 cff c r r .i cf f i f. 1f. i cf U f r f 0f
33 f A f f" ifr Bf cf i B cf B " fUf2rU f f UT *ficf UT .. . 2-rU U fU r U m U f1f' fcf
34 f A f f" ifr Bf fcfBcf .mr f fcf i r B rcf cnfr fF Bi i r i n 1f+f cff i m f ifr .. . fcfr .mi fF i r B rcf Bcf fU m 1f+f cf Ucf
3s f A f f" ifr Bf cf B cf f Bm+ B iff .. .
cf Br% +fr .rfF r fr m U cfBi cf U r fm Bi U+r B Ar
.r i cf+ cf2U U cf f 2fU Bf cf+ m­ mn ficf 2U
f%i .r r U 0fm.cf UT cff fB. r m T f m f f m-r f .
fr Bf% fr m U cf U . cff i r cff B U r m­ U .r m cf

J-011s llllllllllllll11l 1s Paper-II

36 During the year 2012 13, which one of the following was the largest item of expenditure of the central government

Major subsidies Defence expenditure


Interest payment Capital expenditure


37 14th Finance Commission recommended funds as

Central Assistance to States


States Development Funds


States Share in Sales Taxes


States Contributions to Centre


38 FRBM Act 2012 put a ceiling to fiscal deficit of GDP is
6 percent 5 percent 4 percent 3 percent
39 Rostow distinguishes five different stages of economic growth which are

Pre conditions for take off


Drive to maturity


Stage of high mass consumption

Traditional society


Take off
Which one of the following is the correct sequence of stages of growth















J-011s llllllllllllll11l 16 Paper-II

36 f 2012 13 cff U f A f f" ifr Bf cf B cf cff. n B Ucf U cff .rr cf B0Bf 0 i

mni " U Bm r U. .rr .r r m r .rr
37 m%fr f%t r f f f A f f" ifr Bf fcfB U .r fr cf f cff. n+r Bm r . B.. f0cnf+ cf U ifr U .r fr cf+ fm Bf fm ifr f fr cf+ fB1f f U cf+ U .r f%cf B f cff. n cf f U .r fr cf r f
38 1f.* .0+. i. ri, 2012 f Bcf U 6 mnf 5 mnf fU m cf+ U cf f 2U cf+ 4 mnf i B+i f ff U 3 mnf cf+
39 U f 2U f fcf f%cf B cff m f%fi. fr cf f f A mncf U fT +0. i U f cf+ m r mf UmF% cf+ f U nB U .mi f cf U m UAm U Bi i U f A f f" ifr Bf cf B cf f%cf B cff UT fr cf cnfi cf U f m-r

J-011s llllllllllllll11l 17 Paper-II

40 The saving function underlying Cambridge growth model is


Proportional saving function Classical saving function


Differential saving function Absolute saving function


41 According to Keynesions, creeping inflation will help in

Minimising unemployment Maximising real output


None of or above Both and above


42 In the famous equation M=P K K stands for

Fraction of real output held for transaction


Fraction of money supply held by persons


Fraction of money value of output (transactions) held by public


None of the above


43 Geometric mean of 6 and x is equal to 6. What is the value of x
9 3
44 Standard Error (S.E.) of a large sample of size n from a population whose variance is a2 is
22
a a a
SE= SE SE=
SE=
nn n
n
J-011s llllllllllllll11l 18 Paper-II

40 c-ffA0n f%cf B i cf f fU" rfcf cf U f 1f


m f cf 1f F fBcf+r 1f


f%if icf 1f f Umf. 1f


41 cf+.B% f r fr cff B frU m f i n 1f+f Bm rcf m f

0f U f cf f cfi cf U f ifr f%cf m cf f 0 f ifr


.mrf F ifr Bf cf f f m+r .mrf F U f fr


42 mnfB. Bi+cf UT M=P K Y ifr K f A f f" ifr Bf fcfBcff f

f f cff f fcf f%cf m cf i


.rfF r fr U fcf i n m f f cf i


U fcf m f f . cff i ncf i r cf i


.mrf F ifr Bf cf f f m+r


43 6 U x cf .r fi i 6 cff Bi m-.x cf i Fr
9 3
44 Br.r cff cf U cff cf 0 f i f n cf+ i cf f f2U (S.E.) f Bcf UT a2
22
a a
SE= SE= SE
SE=
nn n
n
J-011s llllllllllllll11l 19 Paper-II

4s What is the probability of throwing a total of 8 from a single throw of two dice 1 8 2 9 5 36 3 36
46 The estimated regression lines are given as follows Y=10+0.4 X Y Then the coefficient of correlation between X and Y is. 0.64 0.40 0.20 0.80
47 For a distribution, Mean=26, Median=14, and Mode=7, the distribution would be Positively skewed Negatively skewed Symmetrical None of the above
48 For a normal distribution, consider the following statements It has two points of inflexion. The distance from the mean zero of these inflexion points is ± c . Answer from the codes below Codes Both and are true Neither nor are true Only is true Only is true

J-011s llllllllllllll11l 20 Paper-II

4s f m .B fr cff cf0 U 1frfcf f m U 8 f cf+ c f mn frcf Fr

1 8 2 9 5 36 3 36
46 mn Fcff mnf i fU" r f A B U f m-r Y=10+0.4 X Y X U Y cff BmBA0.' cf T rcf 0.64 0.40 0.20 0.80
47 fcfB+ 0r2U cff f icf Bifi i i f'rcf =14 U 0m cf=7 0 0r2U m f fm Bf i icf fm Bf i .mrf F ifr Bf cf f f m+r
48 mnB i .r 0r2U cff Br0r' ifr f A f f" cf fr m U U cf+f Bifr f mf f cff f f0. m f f m-r. f mf f f0. fr cf+ .r i Bf ± . m­ f c f2U fr Bf .t U .. U f fr Bm+ m-r U ifr Bf cf f f Bm+ cff% Bm+ cff% Bm+ m­21 J-011s llllllllllllll11l m+r m­ Paper-II

49 Match the items in List I and List II and answer from the codes given below

List I List II

Simple random sampling Non probability sampling


Systematic sampling Random choice of all items from each stratum


Quota sampling Random selection of first and systematic of the rest


Stratified random sampling Equal probability of each item in all trials



Codes














s0 If in a village all the farmers are divided into three categories marginal, small and large, and then a sample of 20 farmers is taken randomly from each category, this could be called

Systematic sampling Stratified sampling


Cluster sampling Multi stage sampling


o 0 o
J-011s llllllllllllll11l 22 Paper-II

49 ... . I ... II cf+ i fr cf f B iff cf+f rf f rf m rf c f2U fr cff U m U .t U rf

... . I ... . II
B U r ¥f..Ucf mnf f *mn frcf mnf f
cnfi0. mnf f mn rfcf U cff Bi+ i fr cf r ¥f..Ucf f%cf m
cf f2U mnf f mn i cf r ¥f..Ucf U f cf cnfi0.
f U r ¥f..Ucf mnf f Bi+ m U+. T fr ifr mn rfcf i cf+ Bi mn frcf
.. .





s0 rf fcfB+ ifr Bi+ fcfB fr cf f f B+i r .U f2fU 0 f fcfB fr ifr f%i f fcf f U
m . mn rfcf f Bf 20 fcfB fr cf f cf mnf f r ¥f..Ucf fm Bf f r f Bf cfm Bcf
.r%f mnf f U mnf
Bi m 2U U. mnf 0m UT mnf
o 0 o

J-011s llllllllllllll11l 23 Paper-II

.pace .or Rou.h .ork

J-011s llllllllllllll11l 24 Paper-II