THE UNIVERSITY OF AGRICULTURE

Dera Ismail Khan Khyber Pakhtunkhwa - Pakistan

Summer Session Terminal Examination 2020

Name: _______________ Roll No: __________

Paper: Introduction to Economics Course Code: ECO401
Total Marks: 20 Time allowed:20 minutes
Date: 23-10-2020 Semester: 2nd
Part :(A) MCQs
Note: Attempt all questions. All questions carry equal marks.
Circle the correct option.
Q.1. A study of how increases in the minimum wage rate will affect the national
unemployment rate is an example of: 

A.  Descriptive economics.

B.     Normative economics.
C.     Macroeconomics.
D.     Microeconomics.

Q.2. The economists who emphasized wage-flexibility as a solution for unemployment

were: 

A.     Monetarists.
B.     New-Keynesians.
C.     Classical economists.
D.     Keynesians.

Q.3 Macroeconomics is the branch of economics that deals with: 

A.     The economy as a whole.

B.     Imperfectly competitive markets.
C.     Only the long run adjustments to equilibrium in the economy.
D.     The functioning of individual industries and the behavior of individual decision
business firms and households.

Q.4. What are the tools of macroeconomics?

A.     Monetary Policy.
B.     Fiscal Policy.
C.     Income Policy
D.     All of the above.
Q.5. Deflation is:
A.     An increase in the overall level of economic activity.
B.     An increase in the overall price level.
C.     A decrease in the overall level of economic activity.
D.    A decrease in the overall price level.
 THE UNIVERSITY OF AGRICULTURE
Dera Ismail Khan Khyber Pakhtunkhwa - Pakistan

Q.6. A group of modern economists who believe that price and wage rigidities do not
provide the only rationale for macroeconomic policy activism are called:
A.     New-Keynesians.
B.     Keynesians.
C.     Monetarists.
D.     The Classical school.

Q.7. Per capita income is obtained by dividing National Income by:

 
A. Total labor Force in the Country
B. Unemployed Youth in the Country
C. Total population of that country.
D. None

Q.8. The situation in which the imports are greater than exports is termed as:
 
A. Trade Surplus
B. Trade Deficit
C. Budget Surplus
D. None

Q.9. Who is considered as father of modern macroeconomics?

A. Adam Smith.
B. Prof. J. M. Keynes.
C. Alfred Marshall.
D. Ragner Frisch

Q.10. The rate at which central bank lends to commercial banks is known as:

A. Reserve rate.
B. Discount rate.
C. Open market operation.
D. None.
 THE UNIVERSITY OF AGRICULTURE
Dera Ismail Khan Khyber Pakhtunkhwa - Pakistan

Summer Session Examination 2020

Paper: Introduction to Economics Course Code: ECO401

Total Marks: 16 Time allowed: 2hr’s&40min
Date: 23-10-2020 Semester: 2nd
Part:(B) Subjective
Note: Attempt all questions. All questions carry equal marks.

Q.1. What is macroeconomics? Explain main tools of macroeconomics? (4)

Q.2. What is classical economics? What is difference between

Classical and Keynesian economics? (4)

Q.3. Explain different schools of thoughts. (4)

Q.4. Explain the following: (4)

1. Balance of Payment
2. Fiscal policy
3. GDP

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