JNU ECOM 2010 first 10 ques

[Arushi :))]

QUES1
in a closed economy , the balanced budget multiplier is
1.equal to 1
2.less than 1
3.more than 1
4. dependent on the marginal propensity to consume in the economy
ANSWER - part1
QUES2
stagflation describes a situation of
1.rising prices & rising output
2. rising prices & falling/ stagnant output
3 falling/stagnant prices & rising output
4.falling/stagnant prices and falling/stagnant output
ANSWER - part2
QUES3
If canada has a comparative advantage in the production of wheat compared to US
1. the opportunity cost of producing wheat is higher in canada than in US
2.the oppurtunity cost of wheat is lower in canada than in US
3.with free trade canada will export all of its wheat
4. with free trade US will not produce any wheat
|ANSWER - part 2
QUES4
Infant industry protection is
1. the policy of ensuring that children are not adversely affected by industrial pollution
2. the policy of protecting a new domestic industry from lower cost imports
3. the policy of providing bank credit to industries run by weaker off sections
4. the policy of subsidizing imports in newly industrializing countries
ANSWER- part2
QUES5
For countries in the european union that share a common currency, the euro
1. it is impossible to have different real exchange rates from one another.
2. it is possible to have different real exchange rates from one another.
3. the nominal & real exchange rates will vary according to fiscal policy.
4. the nominal & real exchange rates will vary according to capital flows.
QUES6
the current account balance in an open economy
1. always includes the balance on investment income
2. never includes the balance on investment income
3. includes the balance on investment income & flows of investment
4. includes flows of investment but not the balance on investment income
QUES7
a streetlight is considered good example of a public good because
1. it is provided in public spaces
2. its consumption is non rival & non excludable
3. its consumption is rival but non excludable.
4. its consumption is non rival but excludable.
ANSWER - part2
QUES8
the bottom 20% of world's population are estimated to receive around this much of global income.
1. less than 1 %
2. around 5 %
3. around 10 %
4. around 15 %
QUES9
if an economy is a price taker in the world market for both exports & imports, exchange rate devaluation
1. will have no effect on balance of trade
2. will cause the balance of trade to improve
3. will cause the balance of trade to deteriorate.
4. will turn a trade deficit into a balance.
ANSWER - part2
QUES10
the gold standard refers to an international currency regime under which
1. only gold was used in international transactions
2. only gold was used as money in domestic transactions
3. countries officially linked their money supply to a specific value of gold
4. countries officially linked the value of their money to a specific weight of gold
ANSWER- part4

[Arushi :))]

someone tell answers for 5,6 and 8 ques... and verify the rest

[kangkan]

Question 5.

real exchange rate= Nominal Exchange rate* P(domestic)/P(foreign)

Now Nominal exchange rate is same at 1euro per euro. But the price ratio between ,say germany and france need not be same as price ratio between germany and spain.Hence real exchange rate can be different.

[kangkan]

Question 6.

CA=Trade balance+NPF+Unilateral transfers.

Now investment income is included in NPF.Hence it is always included in CA

[kangkan]

Question 8.

Realy depends on who you ask..but accd to Hammond and Sydnaster,the share of bottom fifth is 1.49%. Closest is 1%

[kangkan]

question 9.

I think the asnwer should be 3. Accd to the J curve,the exchange rate depreciation causes netexports to fall in the short term

[Arushi :))]

@ kangkan - thanks man !  hope to see u here daily !

[kangkan]

Welcome :)..do you know what to do about igidr?

[Arushi :))]

no kangkan.. i dont have any idea.. i m first time appearing..
But i think doing eleventh twelfth maths and basic micro macro alongwith some logic stuff would be enough..
As there are no sample papers.. we can just wait for their mail.. they had written they ll send a mail including the sample paper..

[SoniaKapoor]

basic maths....doing hammond covers all of it..they are very simple i heard
micro macro ...there are 30 questions...do varian n dornbush///they are not as tough as dse or isi
english section is there...but u cant guess what they will give....mostly comprehensions n grammar

[anishagulati]

Hi
question 9 does not mention the time period, so won't we talk about the final outcome where balance of trade improves, i.e option b ?

[ViV]

Assume Price taker is an Indian Economy the Exchange rate is Rs.50/$. Exchange Rate Devaluation leads to new exchange rate suppose Rs.45/$.  So Indian currency appreciates, Exports fall and Imports will rise and net impact is deterioration of Trade Balance.

[Ridhika]

ViV.. The example you have cited is of exchange rate appreciate not devaluation.. if the INR devalues from Rs50/$ it will got to Rs 55/$ not 45/$. In this case foregners can buy more indian goods for the same amount of miney to exports will increase. converesly indians will buy less foreign goods for the same amount of as compared to the period before devaluatoin, so here will be fall in imports. all in all balance of trade will improve

[Ridhika]

@kangan.. can you please tell me a source to study this from?

[Ashima]

So does this make "a" the answer?

[ViV]

@Ridhika: I am not wrong.
I am devaluing Exchange rate. (Exchange rate is Rs.50/$. Exchange Rate Devaluation leads to new exchange rate suppose Rs.45/$.)
you are devaluing Indian currency. (if the INR devalues from Rs50/$ it will got to Rs 55/$ not 45/$.) that's why you are getting confused.

[Homer Simpson]

when you devalue, foreigners will find our currency cheaper. This means that if earlier the foreigner's 1 dollar fetched him 50 rupees, now he can have more rupees. Therefore, in this case, new exchange rate will be above 50 rupees on devaluation.

[Ridhika]

I agree with tsuki.. 

----- Reply message -----
From: "tsuki [via Discussion forum]" <ml-node+[hidden email]>
To: "Ridhika" <[hidden email]>
Subject: JNU ECOM 2010 first 10 ques
Date: Tue, Apr 22, 2014 5:38 PM

when you devalue, foreigners will find our currency cheaper. This means that if earlier the foreigner's 1 dollar fetched him 50 rupees, now he can have more rupees. Therefore, in this case, new exchange rate will be above 50 rupees on devaluation.

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NAML

[Ashima]

Yeah! And then they find our exports cheaper and BOT will improve. The answer marked by Arushi is correct right?

[Anjali]

Please explain 9th !