Q.1.
(a) Differentiate between Aggregate demand and Aggregate supply
(b)
What is Deflationary Gap? Discuss it with the help of graphical depiction
Q.2. (a) If C = 40 +0.8 Yd, T =
Go = 10, Io = 60, Find following
1. Equilibrium level for NI
2. Prove that S + To = Io + Go
3. Find the Value of Multiplier.
(b) Determine the Equilibrium
level of NI in three Sector Economy when there is no Transfer of Payment.
(assume general three sector model in which disposable income can be obtain by
subtracting the taxes from sum of net income & TOP, Other usual conditions may
also apply on the model, care should taken when driving the national income
level at equilibrium because lack of necessary variable ‘ll lead to undesirable
result, also transfer of payments remain autonomous for your consideration)
Q.3. (a) Compare the direct and
indirect taxes on the basis of their pros and corns.
(b)
Briefly discuss different instruments of monetary policy.
Q.4. (a) Explain the Keynesian
law of consumption
(b)
Differentiate between cost push and demand pull inflation.
Q.5. Derive IS frame work with
necessary diagrams.
1.
Monetary
policy.
2.
Fiscal
policy, and its role (tools, expansionary, contracsionary)
3. Concept
of discretionary fiscal policy
4. Types
of unemployment and how do we calculate the unemployment rate?
5. Classical
and Keynes theory of income and employment.
6. Deficit
financing and its sources.
7. Deficit
financing leads to inflation?
8.
Investments
and its types.
9.
Consumption
and saving function
10. MPS and MPC
11. AD
and AS. Factors to shift AS and AD (fig)?
12. Tax
and its types?
13. The
impact of taxation on the AD?
14. Why
does an AD curve slope downward?
15. What
cause AD and AS to increase and decrease?
16. CPI and how it is calculated?
17. What is the relationship b/w
inflation rate and CPI?
1. State bank of Pakistan has taken expansionary
monetary policy by declining interest rate from 13% to 12.5% show the effects
of this policy on GDP, Employment, inflation and foreign sector.
2.
Why
are good and services counted in GDP at market price. Are there any
disadvantages in using in market price to measure production?
3. Is buying an air-condition an act of consumption or
investment in the GDP accounts, what about purchase of house?
4.
What
are the three motives for holding money according to Keynes’s theory of demand?
5.
Why
the tax multiplier [dY/dT=-b/1-b] is negative and why it is smaller in absolute
value than government expenditure multiplier [dY/dG=1/1-b].
6.
Assume
the product improves in quality from one year to the next year and its price
rises to reflect this improvement. What happens to the GDP deflator and real
GDP?
7.
How
would an increase in a sales tax affect GDP?
8.
Is
domestic investment the same as investment done in Pakistan?
9.
What
are the factors that LM-curve shift upward and down ward?
10. Some
time IS-curve shows positive or negative. Why?
11. What policies
should be introduced by the government to eliminate the frictional and
structural unemployment?
12. Explain the expenditure method of calculating GNP?
Short
notes:
Exchange rate
Business Cycle
Real VS nominal
Supply side
stock
Wage price
spiral
Stagflation
Consumer price Index with example
Measuring aggregate output in three sector Model
Consumption function and its mathematical &
Graphical depiction
Balance budget Multiplier (KBB)
Diff: National income at Market
place and National income at factor cost.
Diff: Balance of trade and balance
of payment?
Diff:
Inflation and Deflation
Diff: Economic Development and
Economic Growth
Direct
and indirect taxes
Revenue budget and development
budget
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