JNU 2004

[Ankit Agrawal]

Q 7: Assume that the savings propensity is 18%, incremental capital-output ratio is 5, population growth is 3%, there is no technical progress and there are constant returns to scale.

(a) The warranted rate of growth is greater than the natural rate of growth
(b) The warranted rate of growth is lower than the natural rate of growth
(c) The economy will grow at 3% rate of growth
(d) The economy will grow at more than 3% rate of growth

Q 9: The proposition that public investment 'crowds out' private investment is based on the assumption that

(a) Public and private investments compete because they are invested in the same sector of the economy
(b) There already exists excess capacity in the public sector units
(c) There already exists excess capacity in the private sector units
(d) There is full employment of resources like labour and machinery

Q 18: The coefficient of variation of income of people in a country is 5. Due to changes in units of currency, everybody's income is doubled. The coefficient of variation will now become

(a) 10
(b) 5
(c) 12
(d) 12/5

Q 19. Let x>0. Then

(a) log(x) > x always
(b) log(x) < x always
(c) log(x) is a fixed proportion of x
(d) None of the above

[duck]

19) logx < x always

[Sumit]

18.) cofficient of variation will remain same bcoz its a relative measure..but Standard deviation will be double bcoz its a absolute measure..

[kavya]

Q7. warranted growth is= savings propensity/ capital-output ratio =.18/.03=.036, natural rate of growth= population growth+ technical progress= .03+0 .....clearly the former is greater than the latter. ans: option (a)

Q9. public investment crowds out private investment because (d).

Q18. C.V= standard deviation / mean.  doubling of income=> change of scale. this has an impact on both mean as well as standard deviation i.e., both mean and standard deviation are doubled=> new C.V=2std. devn./2mean=  C.V. hence, C.V remains unchanged.

[RHIDIMA]

In q7 why did u take ur capital-output ratio to be 0.03? Wn't it be 0.05 as mentioned in the question...

[sakshi]

yes, it should be .05
but i think its just typing mistake..
calculation is in line with 0.05..

[laracroft]

Hi Ankit

7. A
9. D
18. B
19. B