09 MARCH 2010.

QI.(A) Fill in the blanks with appropriate alternatives given in the bracket : (5) (20)

(1) If the price of inferior goods falls, the demand for it will decrease.

[increase / decrease / remain constant / become zero.]

(2) Demand elasticity can be measured from the demand curve by geometric method.

[total outlay / percentage / geometric / mathematical.]

(3) macro economics can study the problem of inflation in the country.

[micro / macro / static /dynamic ].

(4) Marginal consumption is always less than one.

[zero / one / more than one / less than one].

(5) To increase credit creation Central Bank purchases the debentures.

[purchases / sells / borrows / stocks ].

(B) State whether the following statements are TRUE or FALSE. (5).

(1) Demand will not increase by coming of new customers. [FALSE]

(2). Demand elasticity concept is useful for labour unions. [TRUE]

(3). Due to the use of modern production techniques supply will decrease. [FALSE]

(4). There is no price discrimination in monopolistic competition. [FALSE]

(5).Due to Government expenditure demand increases. [TRUE]
(C) Choose the correct alternative : (5)

(1) In the period of scarcity of a particular commodity (c).price and demand increases

(a) price becomes less. (b).demand becomes less.

(c).price and demand increases. (d). price and demand decreases.

(2) Demand elasticity of habitual goods is (b).less elastic

(a). more elastic. (b).less elastic.

(c). zero elastic. (d). unitary elastic.

(3) In the long term supply becomes (a).active

(a).active. (b) inactive.

(c). zero. (d). negative.

(4) When income increases consumption and savings will (a) increase

(a) increase. (b) Decrease.

(c) be constant. (d) be equal.

(5).Currency rate of India to other currency means (b).exchange rate

(a).interest rate. (b).exchange rate.

(c).tax rate. (d)profit rate.

(D) Match the following Group A with Group B. (5)

Group A Group B.

(a) Economics (3) Social science

(b) Reward of capital (6) Interest

(c) Value of money (1) Not steady

(d) Establishment of central bank (2) 1 April 1935

(e) Sales tax (4) Income from commodity tax

(5) Natural science

(7) 1 April 1939