Question 1

Which of the following economist is not related to New Classical Economics

Accepted Answer

A) artherlaffer 
B) thomas surgent 
C) robert lucas 
D) neil walace 
A) artherlaffer 
B) thomas surgent 
C) robert lucas 
D) neil walace A

Question 2

According to Milton Friedman Theory of permanent component of consumption-expenditure depends on i. Transitory income alone ii. Transitory and permanent income iii. Permanent income alone iv. Windfall gains Codes :

Accepted Answer

A) i and ii are correct 
B) i and iii are correct 
C) ii and iv are correct 
D) only iii is correct 
A) i and ii are correct 
B) i and iii are correct 
C) ii and iv are correct 
D) only iii is correct D

Question 3

The shape of Laffer curve is

Accepted Answer

A) inverted u shape 
B) u shape 
C) inverse l shape 
D) none of these 
A) inverted u shape 
B) u shape 
C) inverse l shape 
D) none of these A

Question 4

Liquidity trap is a situation when,

Accepted Answer

A) all potential investors expect the rate of interest to rise in future 
B) all potential investors expect the rate of interest to fall in future 
C) natural rate of interest is above the critical rate of interest 
D) demand for money for speculative purpose is interest inelastic 
A) all potential investors expect the rate of interest to rise in future 
B) all potential investors expect the rate of interest to fall in future 
C) natural rate of interest is above the critical rate of interest 
D) demand for money for speculative purpose is interest inelastic

Question 5

According to New classical Economics

Accepted Answer

A) anticipated policy change will not affect output 
B) unanticipated policy change will affect output 
C) both a and b 
D) none of these 
A) anticipated policy change will not affect output 
B) unanticipated policy change will affect output 
C) both a and b 
D) none of these

Question 6

According to New Classical Economics Philips curve is

Accepted Answer

A) always vertical 
B) always horizontal 
C) always downward slopping 
D) downward slopping in short run and vertical in the long run 
A) always vertical 
B) always horizontal 
C) always downward slopping 
D) downward slopping in short run and vertical in the long run

Question 7

In Classical system how to correct an overproduction or glut in the market?

Accepted Answer

A) by increasing price o f input 
B) by wage cut policy 
C) by price cut policy 
D) by decreasing production 
A) by increasing price o f input 
B) by wage cut policy 
C) by price cut policy 
D) by decreasing production

Question 8

The efficiency wage model is associated with

Accepted Answer

A) new keynesian economics 
B) new classical economics 
C) supply side economics 
D) keynesian economics 
A) new keynesian economics 
B) new classical economics 
C) supply side economics 
D) keynesian economics

Question 9

The curve which explains relationship between tax rate and tax revenue is called

Accepted Answer

A) laffer curve 
B) kuznets curve 
C) lorenz curve 
D) none of these 
A) laffer curve 
B) kuznets curve 
C) lorenz curve 
D) none of these

Question 10

The New Classical economics was developed against the back ground of

Accepted Answer

A) 1930's depression 
B) 1970' stagflation 
C) 2008 subprime crisis 
D) none of these 
A) 1930's depression 
B) 1970' stagflation 
C) 2008 subprime crisis 
D) none of these

Question 11

The Menu cost model is associated with

Accepted Answer

A) new classical economics 
B) new keynesian economics 
C) supply side economics 
D) none of these 
A) new classical economics 
B) new keynesian economics 
C) supply side economics 
D) none of these

Question 12

Inflation can be contained by

Accepted Answer

A) surplus budget 
B) increase in taxation 
C) reduction in public expenditure 
D) all these three measures 
A) surplus budget 
B) increase in taxation 
C) reduction in public expenditure 
D) all these three measures

Question 13

The classical model of economic development emphasises

Accepted Answer

A) laissez-faire policy 
B) capital accumulation 
C) both (a) and (b) 
D) none of these 
A) laissez-faire policy 
B) capital accumulation 
C) both (a) and (b) 
D) none of these

Question 14

Assertion (A): According to Keynes, individuals hold either cash or all bonds. Reasoning (R): Because, according to him, the speculative demand for money is associated with uncertainty. Codes:

Accepted Answer

A) both (a) and (r) are correct and (r) is the correct explanation of (a). 
B) both (a) and (r) are correct, but (r) is not the correct explanation of (a). 
C) (a) is correct, but (r) is incorrect. 
D) both (a) and (r) are incorrect. 
A) both (a) and (r) are correct and (r) is the correct explanation of (a). 
B) both (a) and (r) are correct, but (r) is not the correct explanation of (a). 
C) (a) is correct, but (r) is incorrect. 
D) both (a) and (r) are incorrect.

Question 15

Ratex hypothesis is related to

Accepted Answer

A) new classical economics 
B) supply side economics 
C) new keynesian economics 
D) none of these 
A) new classical economics 
B) supply side economics 
C) new keynesian economics 
D) none of these

Question 16

Speculative demand for money is zero when market rate of interest is

Accepted Answer

A) more than the 'critical rate'. 
B) more than the market rate of interest but less than the critical rate (i.e. capital gains occur). 
C) less than the market rate of interest. 
D) lowest (i.e. in liquidity trap). 
A) more than the 'critical rate'. 
B) more than the market rate of interest but less than the critical rate (i.e. capital gains occur). 
C) less than the market rate of interest. 
D) lowest (i.e. in liquidity trap).

Question 17

Assertion (A) : There exits inverse relationship between interest rates and bond prices. Reason (R) : A bond price represents the present discounted value of the payments agreed upon at the time when the bond was issued. Codes :

Accepted Answer

A) both (a) and (r) are correct, and (r) is the correct explanation of (a). 
B) (a) is correct, but (r) is not the correct explanation of (a). 
C) (a) is correct, but (r) is incorrect. 
D) (a) is incorrect, but (r) is correct. 
A) both (a) and (r) are correct, and (r) is the correct explanation of (a). 
B) (a) is correct, but (r) is not the correct explanation of (a). 
C) (a) is correct, but (r) is incorrect. 
D) (a) is incorrect, but (r) is correct.

Question 18

Gregory Mankiw belongs to

Accepted Answer

A) new keynesian economics 
B) new classical economics 
C) supply side economics 
D) none of these 
A) new keynesian economics 
B) new classical economics 
C) supply side economics 
D) none of these

Question 19

Which of the following are main postulates of Supply side Economics

Accepted Answer

A) cut in tax rate 
B) increasing public expenditure 
C) both a and b 
D) none of these 
A) cut in tax rate 
B) increasing public expenditure 
C) both a and b 
D) none of these

Question 20

The insider outsider model is associated with

Accepted Answer

A) new keynesian economics 
B) new classical economics 
C) supply side economics 
D) none of these 
A) new keynesian economics 
B) new classical economics 
C) supply side economics 
D) none of these

Which of the following economist is not related to New Classical Economics

According to Milton Friedman Theory of permanent component of consumption-expenditure depends on i. Transitory income alone ii. Transitory and permanent income iii. Permanent income alone iv. Windfall gains Codes :

The shape of Laffer curve is

Liquidity trap is a situation when,

According to New classical Economics

According to New Classical Economics Philips curve is

In Classical system how to correct an overproduction or glut in the market?

The efficiency wage model is associated with

The curve which explains relationship between tax rate and tax revenue is called

The New Classical economics was developed against the back ground of

The Menu cost model is associated with

Inflation can be contained by

The classical model of economic development emphasises

Assertion (A): According to Keynes, individuals hold either cash or all bonds. Reasoning (R): Because, according to him, the speculative demand for money is associated with uncertainty. Codes:

Ratex hypothesis is related to

Speculative demand for money is zero when market rate of interest is

Assertion (A) : There exits inverse relationship between interest rates and bond prices. Reason (R) : A bond price represents the present discounted value of the payments agreed upon at the time when the bond was issued. Codes :

Gregory Mankiw belongs to

Which of the following are main postulates of Supply side Economics

The insider outsider model is associated with

Macroeconomic Theory and Concepts

Economic Models,Concepts and Theories: Part B

Keynesian Analysis, Monetary Approach, and Classical Model

Filters

Exam 2: Economic Models,Concepts and Theories: Part A

Which of the following economist is not related to New Classical Economics

According to Milton Friedman Theory of permanent component of consumption-expenditure depends on i. Transitory income alone ii. Transitory and permanent income iii. Permanent income alone iv. Windfall gains Codes :

The shape of Laffer curve is

Liquidity trap is a situation when,

According to New classical Economics

According to New Classical Economics Philips curve is

In Classical system how to correct an overproduction or glut in the market?

The efficiency wage model is associated with

The curve which explains relationship between tax rate and tax revenue is called

The New Classical economics was developed against the back ground of

The Menu cost model is associated with

Inflation can be contained by

The classical model of economic development emphasises

Assertion (A): According to Keynes, individuals hold either cash or all bonds. Reasoning (R): Because, according to him, the speculative demand for money is associated with uncertainty. Codes:

Ratex hypothesis is related to

Speculative demand for money is zero when market rate of interest is

Assertion (A) : There exits inverse relationship between interest rates and bond prices. Reason (R) : A bond price represents the present discounted value of the payments agreed upon at the time when the bond was issued. Codes :

Gregory Mankiw belongs to

Which of the following are main postulates of Supply side Economics

The insider outsider model is associated with

Macroeconomic Theory and Concepts

Economic Models,Concepts and Theories: Part B

Keynesian Analysis, Monetary Approach, and Classical Model

Filters