Model exit

1.The problem facing insurers that risky types are likely to accept an insurance policy and

more expensive to serve is expressed by one of the following concept?

a. Adverse selection

b. Auction

c. Market signaling

d. Moral Hazard

2.Monetary policy has much shorter inside lag than fiscal policy because,

a. A central bank can decide on and implement a policy change in longer time

b. A central bank can decide on and implement a policy change in less than a day

c. fiscal authorities can decide on and implement a policy change faster than central bank

d. fiscal authorities can decide on and implement a policy change in shorter time

3.The measure of a change in the national income due to a one birr change in any of the

expenditure is known as.

a. Average propensity to consume

b. Elasticity

c. Marginal propensity to consume

d. Multiplier

4. Which one of the fllowing is not common for UNIDO and L-M approaches to economic

valuation of project?

a. Both involve the use of discounted cash flow analysis

b. Both measures costs and benefits in terms of domestic birr

c. Both involve consideration of factor of equity

d. Both involve the calculation of shadow price

welfare ofa country?

a. it does not have any room for correction for quality improvement

b. GDP omits non marketable goods and services

c. Inclusion of Unpaid household activities

d. It does not account for bads such as crime and pollution

6 .A stage that begins immediately after the final decision on the project and ends when

starte

rendering the benefits envisaged is...?

a. identification

b. feasibility

c. selection

d. implementation

7. According to elasticity approach to balance of payments,

a. If the sum of export elasticity and import elasticity is equal to 1, then devaluation can

improve balance of payment

b. If the sum of export elasticity and import elasticity is greater than 1, then devaluation can

improve balance of payment

c. If the sum of export elasticity and import elasticity is greater than 1, then devaluation

leaves balance of payment as was

d. If the sum of export elasticity and import elasticity is less than 1, then devaluation can

improve balance of payment

8 ..A stationary series can be defined as one with

a. a constant mean, variable variance and constant autocovariances for each given lag

b. a constant mean, constant variance and variable autocovariances for each given lag
c. a constant mean, constant variance and constant autocovariances for each given lag

d. Variable mean, constant variance and constant autocovariances for each given lag

9 .Developing countries participation in international trade is marked by primary-product

export dependence; which one of the following is not among the development consequence

of such dependence? It,

a. Carries with it a degree of risk and uncertainty although long-term trend for prices of

primary goods is generally upward and less volatile

b. Carries with it a degree of risk and uncertainty as the long-term trend for prices of primary

goods is downward, as we as very volatile

C.A sudden loss of income from exports can be devastating

D Specialization in production frequently has brought with it substantial, hidden, economic

costs, including both economic and political distortions.

10 .Purchasing power party(ppp) explains

a .movements in the exchange rate between two countries' currencies by changes in the

countries' price levels

b . movements in the exchange rate between two countries' currencies by changes in the

Couuntries' GDP levels

11 .Which one of the following is the monopoly element of monopolistic competition?

O a large number of sellers and buyers

Ob. Availability of close substitutes

Oc.Perfect information

Od Free entry and exit of firms

12 . Which of the following is an example of a time series data for in Ethiopia

O a. number of undergraduate economics students taking exit exam in the 2023.

Ob. export of 2000 firms in the 2023

Od. Ethiopian total export from 2000 to 2023

13 .We can precisely predict the outcome of any game in which

0 a. One player has dominant strategy while the other 's is dominated strategy

Ob. Every player has a dominant strategy

Oc. All players have dominated strategies

Od. There are only two players in the game

14. Financial institutions are very important for functioning of the modern economic system

in general and encourage economic

growth in particular because

O a. they encourage saving and thus capital accumulation

Ob they distribute risk to all banks equally

Oc. they employ they university graduates

Od. they create information asymmetry between borrowers and lendersy

15 .The Mercantilists view on trade may be summarized by

O a. Enhancement of free trade

Ob. Restricting the use of gold and silver in trade

Oc. Focus on expansion of imports

Od. Advocacy of trade restriction

16. International economics is best understood as

0 a. Application of microeconomics to international Economics

Ob. Application of macroeconomics to international economics

Oc. Application of microeconomics to development economics

Od. Application of macroeconomics to development economics

17. Which one of the following is the distinguishing feature of oligopoly market?
O a. Differentiated products

Ob. Price setting behaviour

Oc. Positive or zero long run profit

Od. Interdependence among firms

18. Along a straight line demand curve,

0 a. Both slope and elasticity are constant

b. There is constant elasticity but different slope

c. Both slope and elasticity are different

d. Slope is constant but elasticity is different

19 .Which one of the following factors rendered the import-substituting strategy of

industrialization largely unsuccessful?

0a Foreign manufacturers were getting only little benefits left over from local industrialist

and could not sustain their presence.

Ob. Protective tariff walls provided immunity from competitive pressures and many Import

substitution industries remained inefficient and costly to operate.

Od. Wealthy local industrialists with whom foreign manufacturers cooperate could not

provide their political and economic support cover.

20 .What is reduced-form equation in simulations systems of equations in econometric?

0 a. It is one that expresses an endogenous variable uniquely in terms of the predetermined

variables and the stochastic disturbances and future values of the predetermined variables

Ob.it is one that expresses an endogenous variable uniguely in terms of the predetermined

variables and the stochastic disturbances

Oc. It is one that expresses an exogenous variable uniquely in terms of the predetermined

variables and the stochastic disturbances

0d. It is one that expresses stochastic disturbances variable uniquely in terms of the
endogenous variables

21 ..In comparative cost advantage theory, the commodity in which the nation has the highest

opportunity cost of production has

O a. Medium comparative advantage

Ob. Difficult to conclude

Oc. The highest comparative advantage

Od. The least comparative advantage

22.The observed facts from the household income consumption confirm that

O a. the marginal propensity to consume is between-to 0

Ob the marginal propensity to consume is between 0 and 1

Oc. the marginal propensity to consume is between 1 and 1

Od. the marginal propensity tom consume is equal to 0

23 .in a financial analysis, which of the following is correct?

O a. Interest is not treated as cost to the firm

Ob. The main concern is the firm

Oc. Shadow or accounting price is considered

Od .Interest on capital is not deducted from the gross return

24.According to the most common way to define the developing world by per capita income

in which income group are developing countries generally classified?

0 a. Countries in low income, lower medium income and emerging markets.

Ob. Countries in low income and emerging markets with fast per capita income growth.

Oc Countries with low income but with fast per-capita growth

Od. Countries in low income, lower-middle income, or upper-middle income groups

25.Which of the following signify the results of the project in terms of the goals achieved

and a number of products p produced?

Ob Outcome Indicators

Oc Input Indicators

Od Impact Indicators

26.Which of the following is a qualitative variable used in econometric analysis?

O a. Monthly income of the individual

Ob. Height of individual

Oc. Education status of the individual

Od. Sex of individual

27.In practice cartel may not achieve the maximum profit due to one of the following reason.

O a. Slow process of cartel negotiation

Ob. Restricted entry

Oc. Variability of negotiated price

Od. The existence of low cost firms

28What are the components of balance of payment?

Oa current account and capital account

Ob. Capital account only

Oc Current account only

Od. Capital account, current account and statistical discrepancy

29 .0ne of the following best describes the role of education and health in development

O a. They are inputs of to the aggregate production function

Ob. They have dual role as both inputs and outputs

0c. They are objectives of development

Od. They have little role as input and output but are final consumption items

30 .The demand for labor is described as

Ob. Substitute demand

Oc. Derived demand

Od. Complementary demand