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MH SET 2018: 28 January, Paper II, Economics

  • Date: 28 January 2018
  • Paper code: JAN11218
  • Series: A
  • Language: Bilingual
  • 24 pages
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Test Booklet Code & Serial No.
                                                                                                                      A
                                                              ECONOMICS
Signature and Name of Invigilator                                                                 Seat No.
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      (Name) ................................................                    Seat No. ..............................................................
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      (Name) ................................................                      OMR Sheet No.

JAN - 11218                                                                                          (To be filled by the Candidate)
Time Allowed : 1¼ Hours]                                                                            [Maximum Marks : 100
Number of Pages in this Booklet : 24                                                   Number of Questions in this Booklet : 50
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JAN - 11218/II—A




2
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JAN - 11218/II—A
                                         Economics
                                          Paper II


                                                        II
Time Allowed : 75 Minutes]                           [Maximum Marks : 100
Note : This paper contains Fifty (50) multiple choice questions, each question
       carrying Two (2) marks. Attempt All questions.
                              (50)                                          (2)



1.   Autonomous Demand indicates                   1.
     that .......................... .
                                                         (A)
     (A) Commodity is used both for the
            export and direct domestic
            consumption

     (B) Commodity is used both for the                  (B)

            direct domestic consumption
            and as an input to produce
            another commodity
                                                         (C)
     (C) Commodity is needed for direct
            use but not as an input to
            produce another commodity

     (D) Commodity is needed as an                       (D)
            input to produce another
            commodity but not for the direct
            use

                                               3                         [P.T.O.
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2.   Stay-out               pricing     approach        2.
     .................. .
                                                             (A)
     (A) Helps the firm to ascertain the
            maximum possible price it can
            charge from its consumers

     (B) Helps the firm to ascertain the                     (B)
            minimum possible price it can
            charge from its consumers

     (C) Helps the firm to ascertain the
                                                             (C)
            maximum price it can pay to its
            vendors

     (D) Helps the firm to ascertain the
            minimum price it can pay to its                  (D)
            vendors

3.   Profit maximising amount of inputs
     occurs when .................. .
                                                        3.
     (A) The slope of the Iso-profit line
            equals the slope             of   the
            production function                              (A)
     (B) The slope of the Iso-profit line
            exceeds the slope of the
                                                             (B)
            production function

     (C) The slope of the production
            function exceeds the slope of the                (C)
            Iso-profit line

     (D) The slope of the Iso-profit line
                                                             (D)
            exceeds the slope of the Iso-
            quant

                                                    4
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4.   The producer shall not produce in                4.

     the third stage of production because

     in that stage ................ .

     (A) The total product is negative                     (A)


     (B) The            marginal   product   is
                                                           (B)
            negative

     (C) The            average    product   is
                                                           (C)
            stagnant

     (D) The marginal product is falling                   (D)


5.   If the commodities are perfect                   5.

     substitutes, the corresponding

     indifference curves would be

     ................... .                                 (A)

     (A) Negatively sloping curves
                                                           (B)
     (B) Positively sloping straight lines

     (C) Negatively sloping straight                       (C)

            lines

                                                           (D) L
     (D) L-shaped straight lines

                                                  5                          [P.T.O.
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6.   In the context of welfare economics,                  6.
     the social welfare function was put
     forward by .................... .

     (A) Hicks and Samuelson                                    (A)

     (B) Pigou and Samuelson                                    (B)

     (C) Robbins and Scitovszky                                 (C)

     (D) Samuelson and Bergson                                  (D)

7.   The average fixed cost (AFC) of                       7.

     production curve is denoted by
     ............................ .
                                                                (A)
     (A) Rectangular hyperbola
                                                                (B)
     (B) U-shaped curve
                                                                (C)
     (C) L-shaped curve

     (D) J-shaped curve                                         (D)

8.   In the context of demand theory, the                  8.
     expression                  ‘Choice   reveals
     preference’ is ascribed to .................. .

     (A) Paul Samuelson                                         (A)

     (B) J.R. Hicks                                             (B)

     (C) F. Machlup                                             (C)
     (D) Robert Dorfman
                                                                (D)

                                                       6
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                                             9.
9.   Risk-return trade off plays an

     important role in whose theory of

     money demand ?


     (A) Tobin’s Portfolio Choice


     (B) Friedman’s restated quantity              (A)

         theory

                                                   (B)
     (C) Baumol’s inventory theoretic

         choice
                                                   (C)
     (D) Cambridge money demand

         theory                                    (D)

10. Ratchet effect relates to :              10.

     (A) Life-cycle hypothesis
                                                   (A)
     (B) Permanent income hypothesis
                                                   (B)

     (C) Relative income hypothesis                (C)


     (D) Absolute income hypothesis                (D)


                                         7                         [P.T.O.
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11. The Samuelson-Hicks type business          11.

    cycle models will show stability as
    well as cyclical fluctuations only :
    (A) Income movement equation                     (A)
        shows complex roots whose
        magnitudes are less than one
                                                     (B)
    (B) Income movement equation
        shows real roots whose
        magnitudes are less than one
                                                     (C)
    (C) Income movement equation
        shows complex roots whose
        magnitudes are more than one
                                                     (D)
    (D) Income movement equation
        shows real roots whose
        magnitudes are more than one
12. In simple Keynesian model of output        12.
    determination,     government
    expenditure will have a bigger
    impact if :
    (A) Marginal propensity to consume
        is lower
                                                     (A)
    (B) Marginal propensity to consume
        is higher                                    (B)
    (C) Marginal propensity to save is
        constant                                     (C)
    (D) Marginal propensity to consume
        is zero                                      (D)



                                           8
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13. Match the following :                          13.

     Statement 1            Statement 2                          1                              2

    (a) Inventory          (i) Edmund                    (a)                   (i)

          approach to             Phelps

          money demand
                                                         (b)                   (ii)

    (b) Adaptive           (ii) William

          expectation             Baumol
                                                         (c)                   (iii)
    (c) Upper turning (iii) John Hicks

          point
                                                         (d)                   (iv)
    (d) Permanent          (iv) Milton

          income                    Friedman
                                                                 :
    Codes :
                                                               (a)    (b)       (c)     (d)
            (a)    (b)      (c)       (d)
                                                         (A)   (i)    (ii)      (iii)   (iv)
    (A)     (i)    (ii)     (iii)     (iv)

                                                         (B)   (ii)   (iii)     (i)     (iv)
    (B)     (ii)   (iii)    (i)       (iv)

    (C)     (ii)   (i)      (iii)     (iv)               (C)   (ii)   (i)       (iii)   (iv)


    (D)     (ii)   (i)      (iv)      (iii)              (D)   (ii)   (i)       (iv)    (iii)


                                               9                                              [P.T.O.
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14. According to Cambridge version of          14.

    demand for money, money demand

    will increase if :
                                                     (A)

    (A) Velocity of money increases
                                                     (B)
        alone

    (B) GDP in the economy decreases
                                                     (C)
        alone

    (C) GDP in the economy and velocity

        increase at the same rate

    (D) Velocity    in    the   economy              (D)

        decreases alone

15. If investment becomes totally              15.

    interest insensitive, then :

    (A) Fiscal policy is ineffective                 (A)

    (B) Fiscal policy is effective                   (B)

    (C) Monetary policy is effective                 (C)

    (D) Both fiscal and monetary policy              (D)

        are ineffective

                                          10
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16. Long-run Phillips curve will not be               16.
     vertical if :
     (A) Price inflation partially takes
                                                            (A)
          into account expected price
          inflation
     (B) Price inflation fully takes into
                                                            (B)
          account expected price inflation
     (C) Price inflation does not take into
         account expected price inflation                   (C)
         at all
     (D) Expected price inflation is
         always zero                                        (D)

17. Prof. Mahalanobis developed ...........           17.
    model in 1955 which was later used
    in Five Year Plans of India.
     (A) Four sector                                        (A)
     (B) Two sector                                         (B)
     (C) Single sector                                      (C)

     (D) Three sector                                       (D)

18. World Bank has indicated GDP                      18.
    growth rate in India is 7.6 percent                     GDP
     in 2016 and will be .................. in
     2017.
     (A) 7.8%                                               (A) 7.8
     (B) 7.7%                                               (B) 7.7
     (C) 7.9%                                               (C) 7.9
     (D) 8.0%                                               (D) 8.0
                                                 11                             [P.T.O.
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19. In which strategic sector of Indian        19.
    Economy hundred percent Foreign
    Direct Investment (FDI) is allowed
    recently ?
                                                     (A)
    (A) Science and technology
                                                     (B)
    (B) Space

    (C) Defence sector                               (C)

    (D) Critical medicines                           (D)

20. Which one of the following has             20.
    propounded the modern theory of
    distribution ?
                                                     (A)
    (A) Nicholas Kaldor
                                                     (B)
    (B) David Ricardo
                                                     (C)
    (C) Mrs. Joan Robbinson

    (D) J.S. Mill                                    (D)

21. Cost-Benefit Analysis was developed        21.
    in USA for appraisal of investments
    in ..................... .

    (A) Agriculture and Health projects
                                                     (A)
    (B) Health and Garden projects
                                                     (B)
    (C) Irrigation and Transportation
                                                     (C)
           project

    (D) Technology and Health project                (D)


                                          12
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22. Quaternary                    Sector     involves        22.           (Quarternary)
    .................. .
    (A) Research and development                                   (A)

    (B) Provision of services                                      (B)

    (C) Industry and manufacturing                                 (C)

    (D) Agricultural services                                      (D)

23. Match the following :                                    23.
                      Theory
    (a) Theory of stages of economic
                                                                   (a)
        growth
                                                                   (b)
    (b) Theory of unlimited supplies of
        labour                                                     (c)

    (c) The Big Push Theory                                        (d)
    (d) Theory of unbalanced growth
          P ropounder                                              (i)
    (i) Arthur Lewis                                               (ii)
    (ii) W.W. Rostow                                               (iii)
    (iii) A.O. Hirschman
                                                                   (iv)
    (iv) Rosenstein Rodan
                                                                              :
    Codes :
               (a)         (b)       (c)     (d)                            (a)     (b)       (c)     (d)

    (A)        (iv)        (iii)     (i)     (ii)                  (A)      (iv)    (iii)     (i)     (ii)

    (B)        (iii)       (iv)      (ii)    (i)                   (B)      (iii)   (iv)      (ii)    (i)

    (C)        (ii)        (i)       (iv)    (iii)                 (C)      (ii)    (i)       (iv)    (iii)

    (D)        (i)         (ii)      (iii)   (iv)                  (D)      (i)     (ii)      (iii)   (iv)
                                                        13                                                   [P.T.O.
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24. To ensure fiscal autonomy to states,        24.

    14th     Finance      Commission

    recommended to increase its share
    from :
                                                      (A) 32%   42%
    (A) 32% to 42%

    (B) 30% to 42%                                    (B) 30%   42%

    (C) 30% to 40%                                    (C) 30%   40%

    (D) 35% to 40%                                    (D) 35%   40%

25. An Integrated Goods and Services
                                                25.
    Tax (IGST) would be collected by :

    (A) State Governments
                                                      (A)
    (B) Central Government
                                                      (B)
    (C) Municipal Corporations
                                                      (C)
    (D) Finance Commission
                                                      (D)
26. Who is not the member of 14th
                                                26.
    Finance Commission ?
                                                      (A)
    (A) Sushma Nath
                                                      (B)
    (B) Sudipto Mundle

    (C) M. Govind Rao                                 (C)

    (D) C.H. Hanumanta Rao                            (D)


                                           14
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27. Which one of the following is not a             27.
     Non-Debt Capital Receipts ?
     (A) Disintvestment receipts                          (A)
     (B) Dividend receipts                                (B)
     (C) Short-term borrowing                             (C)
     (D) Tax Revenue                                      (D)

28. A public good is ..................... .        28.
     (A) A good that the public must pay
                                                          (A)
         for
                                                          (B)
     (B) Non-rival in consumption
     (C) More costly than a private good                  (C)

     (D) Paid for by a government                         (D)

29. Reduction in consumer’s welfare as              29.
     a result of tax is referred to :
     (A) Equity in taxation                               (A)
     (B) Dead weight loss                                 (B)

     (C) Efficiency in taxation                           (C)

     (D) Incidence of tax                                 (D)

30. Which one of the following is the               30.
    major component of revenue
    expenditure of Central Government ?
                                                          (A)
     (A) Pensions
     (B) Interest payments                                (B)

     (C) Defence expenditure                              (C)

     (D) Expenditure on education                         (D)

                                               15                         [P.T.O.
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31. All transactions of ............... nature        31.
     are included in the current account
     of Balance of Payments.

     (A) Stock                                              (A)

     (B) Volatile                                           (B)

     (C) Flow                                               (C)

     (D) Fluctuating                                        (D)

32. The commodity in which a nation                   32.
     has the least absolute disadvantage
     represents its area of :

     (A) Comparative disadvantage                           (A)

     (B) Comparative advantage                              (B)

     (C) Absolute advantage                                 (C)

     (D) Cannot say without additional                      (D)
          information

33. Ricardo’s theory of comparative                   33.
     advantage is based on :

     (A) The opportunity cost theory                        (A)
     (B) The labour theory of value
                                                            (B)
     (C) The law of diminishing returns
                                                            (C)
     (D) The psychological law of
                                                            (D)
          consumption

                                                 16
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34. We can best understand Smith’s             34.
    views on trade if we regard them as
    a reaction to :

    (A) The     law   of   comparative
                                                     (A)
        advantage
                                                     (B)
    (B) The mercantilist view on trade

    (C) Ricardo’s views on trade                     (C)

    (D) The law of absolute advantage                (D)

35. Uniformity in exchange rate occurs         35.
    due to :

    (A) Foreign exchange arbitrage                   (A)

    (B) Devaluation                                  (B)

    (C) Hedging                                      (C)

    (D) Speculation                                  (D)

36. If a country can produce 10 units          36.
    of good x or 4 units of good y, the
    opportunity cost of 1 y is :

    (A) 1 x
                                                     (A)
    (B) 0.4 x                                        (B)

    (C) 2.5 x                                        (C)

    (D) 10 x                                         (D)

                                          17                         [P.T.O.
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37. Match the following :                               37.                   :

    (a) Infant industry argument                              (a)
    (b) Import substituting industrial-
                                                              (b)
          ization
                                                              (c)
    (c) Reduction in the rates of
          protection for manufacturing by
          developing countries                                (d)

    (d) Industrialization           of      high
          performance Asian economies
                                                              (i)
    (i) Domestic           industries        are
          established under the protection
                                                              (ii)
          of tariffs or import quotas

    (ii) New industries need a temporary
          period of protection                                (iii)

    (iii) Not via import substitution but
          via export of manufactured goods                    (iv)
    (iv) Rapid growth of trade
                                                                        :
    Codes :
                                                                      (a)         (b)      (c)    (d)
            (a)     (b)      (c)    (d)
                                                              (A)     (iii)       (i)      (iv)   (ii)
    (A)     (iii)   (i)      (iv)   (ii)

    (B)     (iv)    (i)      (ii)   (iii)                     (B)     (iv)        (i)      (ii)   (iii)

    (C)     (iii)   (iv)     (i)    (ii)                      (C)     (iii)       (iv)     (i)    (ii)

    (D)     (ii)    (i)      (iv)   (iii)                     (D)     (ii)        (i)      (iv)   (iii)

                                                   18
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38. What can you say about the                  38.
    following statements pertaining to
    Foreign Direct Investment in India ?
                                                      (i)
    (i)   FDI through automatic route
          does not require prior govt.
          approval.
    (ii) FDI through government route
                                                      (ii)
         requires approval of the
         government through Foreign
         Investment Promotion Board.
    (A) Both statement ( i ) and                      (A)         (i)      (ii)
        statement (ii) are incorrect
    (B) Statement (i) is incorrect and
        statement (ii) is correct                     (B)         (i)            (ii)

    (C) Both statement ( i ) and                      (C)         (i)     (ii)
        statement (ii) are correct
    (D) Statement (i) is correct and
                                                      (D)         (i)              (ii)
        statement (ii) is incorrect
39. Which of the following is not a tool        39.
    used by RBI for regulating money
    supply in India ?
    (i)   Open market operations                      (i)
    (ii) Repo rate                                    (ii)
    (iii) Statutory Liquidity Ratio                   (iii)
    (iv) Disinvestment                                (iv)
    (A) (iv)                                          (A) (iv)
    (B) (i)                                           (B) (i)
    (C) (iii)                                         (C) (iii)

    (D) (ii)                                          (D) (ii)

                                           19                                             [P.T.O.
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40. Which of the following are examples              40.
    of a direct tax in India ?

    (i)   Excise duty                                      (i)

    (ii) Service tax                                       (ii)

    (iii) Income tax                                       (iii)

    (A) (i), (ii), (iii)                                   (A) (i), (ii), (iii)

    (B) Only (iii)                                         (B)         (iii)

    (C) (i) and (iii)                                      (C) (i)     (iii)

    (D) (ii) and (iii)                                     (D) (ii)     (iii)

41. In the year 1966, the exchange                   41.
    value of rupee against American
    dollar was devalued by ................ .

    (A) 75%                                                (A) 75%

                                                           (B) 65%
    (B) 65%
                                                           (C) 48%
    (C) 48%
                                                           (D) 57%
    (D) 57%

42. The All India Rural Credit Survey                42.

    Committee, 1954 was chaired by :

    (A) D.R. Gadgil                                        (A)

    (B) V.K.R.V. Rao                                       (B)

    (C) A.D. Gorawala                                      (C)

    (D) Vaikunthlal Mehta                                  (D)

                                                20
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43. Among top fifteen fastest growing                 43.
    service sector countries ........... share
    of services in its total GDP is less                    GDP
    than 50 percentage.

    (A) France                                              (A)

    (B) Germany                                             (B)

    (C) China                                               (C)

    (D) Australia                                           (D)

44. Which is the correct descending                   44.
    order of India’s software export
    destination in recent times ?

    (i)   Asia Pacific, North America,
          Europe                                            (i)
    (ii) Europe, Asia Pacific, North
                                                            (ii)
          America

    (iii) Europe, North America, Asia                       (iii)
          Pacific
                                                            (iv)
    (iv) North America, Europe, Asia
          Pacific                                           (A) (iv)

    (A) (iv)
                                                            (B) (iii)
    (B) (iii)
                                                            (C) (i)
    (C) (i)

    (D) (ii)                                                (D) (ii)


                                                 21                               [P.T.O.
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45. The abbreviation ICOR suggests :         45. ICOR
    (A) International Credit Output
                                                   (A)
          Ratio

    (B) Incremental Capital Output
                                                   (B)
          Ratio

    (C) Incremental Capital Output                 (C)
          Range

    (D) Indian Capital Output Rules                (D)

46. Statistic is a numerical quantity        46.
    which is calculated from :

    (A) Population                                 (A)
    (B) Sample                                     (B)
    (C) Universe                                   (C)

    (D) Hypothesis                                 (D)

47. Which of the following is used in        47.
    chain indices ?

           pn                                            pn
    (A)    p0
                  100                              (A)          100
                                                          p0

            pn                                            pn
    (B)               100                                           100
           pn 1                                    (B)
                                                         pn 1

          pn                                             pn
    (C)             100                            (C)            100
          p0                                             p0

           pn q n                                        pn q n
    (D)                 100                        (D)                100
           p0 q0                                         p0 q0

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48. The most suitable average for                        48.
    qualitative               measurements     is
    ..................... .
                                                               (A)
    (A) Arithmetic mean
                                                               (B)
    (B) Median

    (C) Correlation coefficient                                (C)

    (D) Geometric mean                                         (D)

49. The strength (degree) of the                         49.         (x)
    relationship between a set of
                                                               (y)
    independent                variable   x   and
    dependent variable y is measured
    by :                                                       (A)

    (A) Coefficient of correlation
                                                               (B)
    (B) Coefficient of determination
                                                               (C)
    (C) Standard Error of estimate
                                                               (D)
    (D) All of the above

50. Consumer Price Index number is                       50.

    also known as :

    (A) Wholesale Price Index number                           (A)

    (B) Cost of Living Index                                   (B)

    (C) Sensitive                                              (C)
    (D) Composite
                                                               (D)
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ROUGH WORK




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Source: Savitribai Phule Pune University. Question paper published by Savitribai Phule Pune University.