Dse past year_1996

1. ,
Ju.l y,
1996
DF.Pf-RTMENT C.1i;,
DFLE.I SCHOOL OF ECON0111cs
ECONOMrcs
MA Adm Iss iot1,; .. ""'" Scht11,.,_.,, ,,i p '1'<>:a
J'J IJr; .. 'J/
(l) Please wr He Your r o J l II Umber on top of th; s Pago. i11 Ches~acc Provided for iL.
~
( 2 J NaJ,e sure that you I," vc "rit ten bo ti, Your nau,c ,o,;,/ ,·,,_; 1
'"'"'be,- on the det<>cJ,,,1,1c -"li1,s of n11 the «us,.c,- 1,oo.',s '°"" !,,,o.-_
( J J Tit e rn are two q uc.5t io11 pa Pers 1" LI, is t,Ook. ,111s,,,.,,. ,,,,,_ Ge!<;.
Candidat es w1,o Ila ve done eco11om i cs at the Ur1<Jr, ryca du.-, t c .l ~,,.,,:
"ill find option A the more suitcbJc of the two, t1i1 Jfr <:1,,,,,c, ,._·/.,,
·have done Mat1,cmat .ic,r , Stau ,,lic:;, 1'/11•:;ic,;, """"'""<in~. 0cc . .,.,
to ons"e;· either }>aper.· D"t you ""'St nnt, .i ,. '"'Y c."·cu,,,.,·,c,,,,_, ..mix questions from l11c tr-10 .
( 1 J 1'1ease i ncti cat c• on the lop n "h l ;,.,,,u cor,.c r .,; [ l'o,; r a""'",.
-booklets l•<hich of ll,c two '"'Pees l'Ot> ha,•e "l lcmr,tc,J
;,crtai,,;ng lo it. Hcuc then, careful},- bctorc ,·ou bQgi n onsi;,o,;,.,,
·. he Paper.
question
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2. Option A
This paper is in three p;uts.
all three pacts.
You ace ceq~iced to ~!Lt.
/ separate booklet w i 11 l>e prov itl~tl to you for
/nsw~r to q11c!'.tio11!; lTI thi" par.t shouJ.~.1- l;epaper.
in th.is
i~1norctl
book.let. Yo11r. a11:;wcc~ lo Lid!, p,irl: are
i [ ·y c u cl o t IIe III c l s c , 11c r e .
/ t, !,w e i: s to - Pa r l: I ( and Purl: J 11 slui11.l.d l><! i11 Ll1<!
l>ook.<!l.. Hcite a11sw<!t"S ~o l'.1 c I: 1 l 1 011 the la:; L pa~Jo Cl [ :.c;t.:011
l>ool<.lct. Your answers mny uut iu11orecl if you ·1rlt:c
elsewhere.
Word l.im.i ts have been :;l.i.pul.alcd 011 a11:;wc1·:; l.o .i.l l
in Purl 1 and to some quest.ion:; i11 Part: .l l. Tile::;<! :.;l1oul:.i b
observed strictly. /11!;wcr:.; which ar.c 11ot to t!1c po.i11t,
verlH>!,C, w i I .l L>ci pci11;1 l i zed.
l'art 1..
( 7-(! lllil r:k:;)
/ns1-1er any l:_ljO quest.ions. lll q11C!";L .io11s c,11.Ty cqu.il 111<1;·/:.';.
Use eco110111ic reason_i ny lo a11s1,1cr l /J~se q11cs tj O11s. !,.i :,i it
your .-,11s1,1ers lo JOO ·,1or·ds . Verbose_ ,111s1,1c,:s 1,1j,.L l __i;c .
penali?ed.
Examine briefly the lu~y is!;uc!s undcrlyi11u Lite cltoict! beltecn
external co1111nercinJ borroHiny and (orci911 privalc jnv cstment I
for fi11c1nci11u Lite cur1·c1:L occounl tlcfic.i.L in lntlia':.; l;c.Jl,111c2
0 ( p iJ Y Ill C 11 LS .
Wllat do you undersland by L11e term ·scissor:; crisis' ? Jtov:
....,as i t r:- es o l v e d i n Ll1c ( o r III c ·r So v i e t Un i o 11?
Critically cxami11<! the official cli..ti111:; of brj11~1i11q tlo·111 U1c
a nnual rate o( i11flc1t.io11 in Lile currc) 11l. fi11-111;1ci,1l year
focusin(J on: (a) l.l1c• pr i,·0. i11cl<'x 11:;1;d, (1,) I.lie ..tJl.cr11;1l:iVC
proccc..l11rc~~ or co11q111l.i11q 1.ti t~ .11111u,11 r.1Lc o( in(lalion, and
( C ) t It e r O l I~ L' ( ,HJ Ill i l ti S l: (; re t.i pr i CC S .
1
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3. V
.,
,
1.
-------
l'arl 11 .
( GO m.i r.lts)
/ns1,1er any l.I questions. 1'll qucslions carry equ~-:l 1,,,:1 ;_ :..,.
Pa rls of questions c.:i rr ry proporc: i.on,1 lc "'C ig/1 l. Lim;:: ":::.; .. .-
a nstve rs to _1,__5_(!_ tvord!; foe ri11csliu11~; 1 c111cJ ?. . Verbose ,,1!:;1-::!i ::
·t.,ill be penalized .
"lli9ec tlle l eve l of foreign excli<1119e r-ese rves, the better
~
it is for the economy". Uo you a~rcc? Explain you1:
answer·.
2. Keeping {n 1ni11d the inlercsts o[ c1ll ,1f[cc tcd <::;rout)S, as:;;<::ss
Llle des i r ab i l i t y o [ · s H :3 d c :; ll i ' for LIIe l II d i an e co II o 111 y .
3.(a) Tile demand fu~1ctio11 o[ a co1111nodily is 9ivc11 i.>y
q=ApE
( b)
Hhere q = quantity demanded,
p = pc ice o( Lhc c0111111LHli t.·,-,
/ and c arc ~l iv c 11 co11~.;LaI1l.s.
S how thal the price clast;..icily o( ue1!1..1nd j_s co11~L.~i1~.
I f ( p = 2 fl, q = G) tll I cl ( i> = J r. q :.: r, )
elasticity o[ dcina1,d.,
,~ Dra,' indif(cn!ncc cur-vc.; and lHL' (en~11ce dircclio11 ai:cO-JS
depicting eac h of Lhc following prelt-tcnces:
(a) l love cheese but !1<1Le lJutLet.
(b) l can' L Lell L11c cli((ccc11ce lH~l1,•0:1 Ci.d(,· ,1;: ,'l:f•, ,,.
l like bolll o( Llwm .
(c) 1 lo"'-' c-1 lcci, ,111<1 ~,,•~•,-t:; h111 .1 1 ;_,•1 ;1 poi11t l dislil~C!
Analy ze dia~1rom111c.1Lic,,Jly L11<! c.:u 11 1;c•ql'C!!ICP o[
specific (u11iL) L .::1 ►: 011 ,1 r it11 l ,1c1il'J ., lti1il,~d <1-.•1n<11HJ cu 1 vc .
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4. (i :
I-; X ;1111 i 11, • t I 1, • r • I I t ·,·I
c, r
·1. c,,, "" ,.,,,.,,.,,.,,," ;""'""""·'" ,.,,,,.,n" i<::111 Lu;, <iccJJ11., 1,
ooLp,,t Ucc ;,1.,, ., ul io<11, cc,) i1,nc,1:;c i,1 im1>unc; - l':xpJ,1 .111 Yo e; I 11:; ,/ ( • 1·
o_
11 _j Ill
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1-1.i i 7. ()
-'< ; . · '
subject.:
Lo .'( I ~
C.'(]
v•• I ,
9. F j "" :i '""'""'"' ; v., I" L ,,., ",·:. "'""'" ""'" ;, 11<1 p I oduc1. « r" "', "" l.E:q1Jo1J11 Yo11r n1 1!;,,.,,~,.
/
10. l( SoAvlJ, l'(A) o o.·1, 011,J l'(fJ)oo.s,
') ·I, ':> 1 - Of.i,u1 l<(Afl//J, l'IMll1J •'>I l'( ,1'11JJ
C i :;
ll Ou " I ~ - ,p.,,;; l. "'" ""' Ii. i p I<,. cl10 k,, '·"'"·, l.lu, "' ,., , . I :,i, r
"'""';,,,., """"'"" 1,,, c:,c,, 'P«,slio,, ut "hi,;1,, '"'" •· · c.,, ,.,-~,
( -:1 ) Ifu1,1 i s X
(I i s L t · i uu L C? t I "?
PW'~( b)
Civn I I I 0.
V ,t f 110.~
of .13( Y. ) .-, 11 ( I V;, I
( >: )
"/t-t
( C ) ,.- i I I( I
I, ( 1/. ~
G; .....
l J -
1 2 sf1() ./
1. I 1: 1 I
LI1<' ,I I
I 11 11 c • L j , .-
Ill(•; I JI c, I
>: I ( 2 IJ ) .-,, ,c1
Y. J ( ?: u ) _, :, (
le:,,~ L ; I =, J ;I l - <J 0.
;1 :.;
l I I (_;
<J l: CJ111t: l r· j c
l11 l '. <..! II
U[ >:1.:r11 Ll
%2.-I It; I I i ::
.i I I l l I I ( ' I I C ( ' i l. .·'
' " ()I le' )' 1111 I I I I J I ; j <" f
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5. r
-- ~J -
l'dLI. 111.
( 20 11,ark!.i)
/H:l:e111pl: ,1J L q11c!;l.i,111s.
ec1cli question J:nclica tc
c hoice of anstver D
derivations etc . need
p,1 rt:
I LI q11,:sl.io11s c.-i1.'I.')'
011c clwicc: (c. g. 1-U
[or q ues I: .i on 1 ) .
<.'l/11,lJ. Jll, ll:l:::. :··c_.;·
ivill sig11Li._:· ye:,~·
No C<l 7.c:11J,-.I: cUii:',:
l:o J;e pcc~;e11Led for CJUCStiOJJ!i .I. ii Lil.?.::;
Caul.io n: l'ICCJ.Jlive pc111.:1J. 111;1rkir1q!
LJo nol 111,ilu.: •..,iJd (JUl!!:>S ;:l,uul. .i11s-/et:;. I corre·cL
1-1..Ll l cost
u ri s v1t: J 1, i J. I
felc!J you Ofl<: 1a:1rk, l,;1l. ; , •,11·1, 1HJ .111:-;•ll!r
111arl<...
/ I I : ; ,/ C! ,.. : ; I () I I I j : ; I >; 1 l ~l. 111 l l:: I I /I: ; I l L: 1111 ,l ·~ d
S<~cu r1u ;_111s1,1c1r l >oo lc lel.
J . I (' ;,1 C () fl S IJ 111C C :,; p '-~ 11 d :; ,1 l Ii i :; l fl CC) 111(!
~ L.1 s l i C i Ly u l ll I i.l L (_J '.)l) d i :,
( ;1 ) i 11 f l l I i l.. C
(l)) 7..CfO
( C ) !)C l: vi CC 11 Z e r O .t ; Id O IIf!
(d) equul to one.
yuu ·11._i Ll
2. ·/) 1i3. I: i S t lt C! d i S l. i II· JI I i S It i r I(l t: Ca l l l r e <l f ,I CC 1H p G t i l .i V C!
( ; l ) ll<:i:1;i rtd :;I.opes ' Il) ·/ l I
( lJ ) t·iC i ~~ cor::; i: i.111 L
( C ) fC is j_ d (! I l t i C cl L lo M<..:
( cJ) Tu l,11 rcvcnu-c i. :; ;,1 r" Y f" r· uI11 L11e ur i(Jill.
3. l[ LIUC l!:> [;1 lJinc.1 '.-)ll(!CC lL is ;tr,() l' ll l. l.c SIU'.C Lltc11
( i ) 1.11: :c Ill II'., l lJ,:. I :, I I i i ~i
( lJ ) SHi·iC i1;Lersc·cl:. LIUC LO L11e L'.:! ( L ol l Ile l.,HllJency
0 Sll/C l S 111 i. r1 i :11 i ;·.ed LO L li e r i (J lIL or l l1 c Lt.1nge11cy
( d ) SIUC < SIU-C .
1
1. Tile i11co:1e coI 1su11Ipl.1uI1 curve [or 2 s;oods :" and y l1<1 s
( i.l ) ) / .,~ :. 0 l Jo LI 1 Y. d I tel "I
-~) ) ro1· IJo l ll .·, i I! t!
,.
'( C ) 1/3 i:or X a 11 0 7.. I 3 for y
( d ) noI1e o[ L Ile c1bc.,ve.
5. Tile 111ar g ~rw 1 propens i Ly Lo sove is O. 2 .::. 1:d tile inco1i1C Li1;-:
r c1 l: c
( cl )
( b )
( C )
) ')
j :; Il . l .
1 . J
? . J
J ..
T I I c 111 u I l. i p I i n r- l
, .
.,
J.
!'
. I
I
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6. .....
6.
-· (i -
I n ct 11 0 pen e CO II O in y ii ll C XO CJ 0. IIO LIS J fl C r (! il S 0. j I I j It I/ l! ~-; L111 l.! l I L
( d )
),-b)
( C )
( d )
t lie~ ri
( ii )
( IJ )
( C )
(u )
i11c1·e,1:;c 011Lp11t i111d 1111prov0. Ille L1·i1dc! li;1l;i11 c-t:
i11creu:;c ouLpuL ill1d v1orse11 Lhc Lrade IJaLH1cc
l o 1-1e r o u Lp u t a 11 cJ 1-1 o t· s e n t IIe :: r u d e lJa .l r.1 fl c c
none of Lile nbove
i."sc.:iL policy is <!ilc!clivc! il11cJ 111011ct.;1cy policy i:;
i11c_l(ecL tvil:!
fiscc1l policy ls i11cffective urid 11101ictnr)' L,olicyeffective.
both <1re effective.
IJ0L11 arc i11ef fectivc.
U. I[ L11e cor r clc1Lio r1 bclv1e 0 11 J:< c.111d l i~ 1 UH? ~::Hrela•ic,n
he t 1-1e cc 11 x / 2 ;1 11 d - y i s
9.
(,1) r/7.
(I>) r/7.
(c) - r
(u) r
C CJ r f C .I iJ L i O I l C U () [ ( i C i C? II I
C (I<! f i C: j C! I I I () f I <! q I <: ! ; ~;. i (i II O J :-: 0 11 y i :,
IJ C t ,/CC II Y. i II cl y
~ ( ii )
( l) )
( C )
( cJ )
.u ✓.
- . 0 2
. 1
l
. ,.
., U./,
10 . I ( / and lJ i) t '~ l 11 d C p e 11 d C:1 L CV C fl Ls ' a nd p I. / ] ·- 0 . :- il I 0.
p [ / u B] ~ u. ·; . Lltcn r ( u J is
( il ) () . '.i
( IJ ) 0.2
~ { C) (J . ,,
( <I ) () . :i ',
1::. . { C , 1 I. ·/ l LI I s 1
( ,I ) 1/]
( Ii ) l/U
( (; ) 1 / 1 1
)
( <I ) IH)ll(! or I I IC· : ,IH) V( ! .
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7. 1 3.
E(X) = <J, E(Y ) = 1 then
01) X .111d y ii l"() i 11u<)IH: 11dc11 L
( b ) X nnu y nrc uncor r elolccJ
( C ) X and y are 111utunJl y C ;, C l u ~; i V C
( d ) None o ( th e abov e .
Na tional income of a c ountry g rowing at the rate of.X%
per annum, while its population rs growing at _Y% per annurn .
1'11e rate of growth of µer caµil ,1 income is givC::n by:
(n) X - Y
( b) X Y
(c) X + Y
(d) X / Y
11. India's forei911 exchange reserves, i'.lt the ucyinni n g of the
cur r c n t f i rw. 11c i u 1 y cur , w c re II cu r cs L tu :
(a) $ 50 million
(b) Hs 200 crores
( c ) $ 1 ., lJ i l li o ll
(cJ) $ 3'.:i billion
15. The~ objective of Credit i{cservf1 natiu- (C!lH) is to:
(,1) subsidi7.c ~>a11ki11<J opcr,1tio11s
(lJ) raise resources (or· l.ltn ~1uvcr11111c 11L
(c) rG~Jul~Lc 1110110.y supply
(cl) 1101l) Of I.Ill! ,tlHJIJ<:.
pr lC:C) S " .
t 11,1L
( 0 J
( b J
lJcc r casc 111
tlo i ncrease
s up p ly.
1110 ll ( ) Y SU pp 1y J. e u <J:.;
i II pr i CC! S j 111 [) l i C ~;
Lu .1 p ri ce fall.
110 1 II C l Cu SC in 1110 11 cy
( C )
( d )
l ( Ll1cr0.
I II C r C! ~ :-; C!
11011c' or
.IS .Ill i llt:I c;1sl!
i 11 111011c)y :;:1pp ly .
Lit(' , II H)V('.
i fl [l I
' l . l l I ·· ( x ) < u LII e 11 i L 1 : ; 1)c>s s i LJ .l e LI1,1t.
( ; I ) I ( ) i~ i ll C I ( : ,I : ; i tt<I :1 l : I 11:r; 1· c,;1 • ; I II I
( l> ) I ( ) I,.., d<•c: I ('":, i II <J .i l ;1 cl cc:1 (!;' :, I II CJ
( C ) I ( ) i ~..; j II C 1· c;1:; i I ll) ,1 l ; I I l l I IC I (' . ' ~·,.., i 11 CJ
yd-') l' ( ) I ll) I ll! o( LI I ( ' ;ll,ovc
r :1 I c:
;1 l c:
1· ii L C
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8. --u-
10. Life cycle l1yput.l11!:,i:; oJ. <..:u11su11:ptio11 j111pJ.ics Lhc1L
propensity lo ccn1~;11111<! i:,
] l.J ••
( ;1 ) ii I ·/d y:; IlC' ( -J l' ( • I I (,- ; I II d
(b) ;1J-,1;1ys ~1r·cc1Ler l.11.111)
( c ) i.t l 1-,1 ,t y s 1p · C! i.t L ci r l II i.t 11 0 .
(cl) 11011 c of Llt0. ,tl>ov< : .
I 11 I I I I J I) •
')(,,
( ; I ) /.
i ::t:;, I ll<: t It:; L .:.i:; <l fll!I t:<!11 Li.tUt~ of t;fJI' ·u1:-;:
( IJ ) (i
( (: ) II
( d ) I ()
...
~
20. Tiu, luc,,nsL slta re of Lux n,vonu<,s for tho Indian econo1:,y ;
11
199'1-<J S ca rue [ ro111:
.--hi) excise l:ux
( b ) i II r: Cl Ill C! I: i1 X
( C ) Lil r i [ [ :-;
( d ) S it 1C! !-> t il X .
',.
I
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