Classical

June 2015 - Paper 2

1:  
If the demand for using the Naida express way is given by :
Q = 40,000 - 2500P
Where Q is the number of users (vehicles) and P is the amount of toll collected per unit who
uses the express way. In light of this information which of the following is true:
A.

At P =  6 and Q = 14,000 ; demand is price inelastic

B.

At P =  7 and Q = 16,500 ; demand is unitary elastic

C.

At P= 4 and Q=9,500, demand is price elastic

D.

All of the above

 
 

Option: C

Explanation :


2:  
If a 100% scale-efficient plant has 92% technical efficiency and 88.5% allocative-efficiency,
then its overall efficiency will be :
A.

88.5%

B.

90.25%

C.

93.0%

D.

81.42%

 
 

Option: D

Explanation :


3:  

The market share data for an industry, comprising five companies, is given below:

Company                                  Market   Share(%)

A                                          35

B                                          25

C                                         18

D                                         12

E                                          10

This industry's three-firm~erfindahl-Hirschman index shall be :

A.

0.234

B.

0.217

C.

0.151

D.

0.0175

 
 

Option: B

Explanation :


4:  
For an economy which consist of single automobile maker and that in year 2014, 30,000 vehicles are produced with an average price of ~ 5 lakh. For this economy what would be the increase in the nominal GOP for 2015 compared with 2014 with the 4% greater automobile production and 8% inflation.
A.

4.0%

B.

12.0%

C.

6.0%

D.

12.32%

 
 

Option: D

Explanation :


5:  
Demand policies targeted to reduce the unemployment become ineffective in presence of the I
following:
A.

Vertical phillips curve

B.

Money illusion and ignorance among workers

C.

Horizontal phillips curve

D.

None of the above

 
 

Option: A

Explanation :




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