Town Officer Paper of 26-05-2023 (SPSC)
If Pakistani citizens become less concerned with the future and save less at each real Interest rate:
A. Real Interest rates rise and Investment rises
B. Real Interest rates rise and Investment falls
C. Real Interest rates fall and Investment falls
D. Real Interest rates fall and Investment rises
If a consumer spends more on a product after a fall in supply, then demand is:
A. Inelastic
B. Volatile
C. Unitary elastic
D. Elastic
Diamonds are more expensive than water because:
A. Households are irrational
B. They are more useful
C. They yield higher marginal utility
D. They yield higher total utility
Everything else the same, the higher the interest rate the:
A. Lower is the opportunity cost of holding coins and currency
B. Greater amount of funds business will borrow for investment
C. Greater is the incentive to save
D. More money the federal government would like to borrow
According to classical economists, the wages are flexible:
A. Upward
B. Horizontal
C. Downward
D. Inverse
If the price of a good rises and households’ incomes go up by exactly the same proportion, then the quantity of the good demanded will:
A. Increase
B. Decrease
C. Show an unpredictable effect
D. Decrease or stay the same, but not increase
If at the current level of output, the firm’s marginal revenue is less than its marginal cost, then firm should:
A. Increase output
B. Shut down
C. Expand its capital stock
D. Decrease output