SPSC Lecturer Economics Past Paper 29-04-2024

1- Which of the following is a tool of fiscal policy?

A. Open market operations 
B. Discount rate 
C. Government spending
D. Reserve requirement

Answer : C. Government spending

2- A profit maximizing firm under perfect competition will produce:

A. Only in the first stage of production 
B. Never in the range where MP is diminishing 
C. Always in the range where MP is diminishing 
D. Never in the range where AP is diminishing

Answer : C. Always in the range where MP is diminishing

3- The market structure of monopoly is characterized by:

A. A single firm producing a good that lacks close substitutes
B. Differentiated products produced by different firms 
C. Extensive non-price competition
D. Marginal revenue [MR] less than price for several firms 

Answer : A. A single firm producing a good that lacks close substitutes

4- What is the primary objective of a central bank’s monetary policy?

A. Maximizing Government revenue 
B. Achieving price stability and controlling inflation
C. Generating profits for shareholders 
D. Encouraging consumer spending

Answer : B. Achieving price stability and controlling inflation

5- Which sector typically contributes the largest share to Pakistan’s GDP (Gross Domestic Product)?

A. Agriculture
B. Services
C. Industry
D. Information Technology and Telecommunication

Answer : B. Services

6- The Phillips curve illustrates the relationship between:

A. Inflation and unemployment
B. Inflation and GDP growth 
C. Government spending and GDP growth 
D. Interest rates and investment

Answer : A. Inflation and unemployment

7- All of the following are parts of the business cycle except:

A. Boom
B. Slump
C. Recovery
D. Acceleration

Answer : D. Acceleration

8- The GDP (Gross Domestic Product) of a country is $100 billion. If government spending is $20 billion, Investment is $10 billion and net exports are -$5 billion, what is consumption spending?

A. $75 billion
B. $80 billion
C. $85 billion
D. $90 billion

Answer : B. $80 billion

9- Islamabad isn’t ______ Lahore.

A. As cheap than 
B. So cheap than 
C. So cheap that 
D. As cheap as

Answer : D. As cheap as

10- When both the demand and the supply curves shift to the right due to any reason then:

A. The quantity traded and price of the good increase for sure
B. Quantity traded increases for sure but prices decrease 
C. Quantity traded increases for sure but prices remain constant 
D. Quantity traded increases for sure but nothing could be said about prices

Answer : D. Quantity traded increases for sure but nothing could be said about prices

11- Given own price elasticity equal to -2.5 implies that if the price of the good increases by Rs.10 then the quantity demanded of the good:

A. Will decrease by 2.5 units 
B. Will increase by 2.5 units 
C. Will decrease by 25%
D. Will decrease by 2.5 % 

Answer : C. Will decrease by 25%

12- Which of the following oligopoly model are concerned with the maximization of joint profit?

A. Collusive model
B. Bertrand model 
C. Cournot model 
D. Edgeworth model 

Answer : A. Collusive model

13- Total revenue equals:

A. Price times quantity
B. Marginal revenue times marginal cost 
C. Profit per unit of output 
D. Total cost minus profit

Answer : A. Price times quantity

14- According to classical economic theory, a decrease in the money supply would.

A. raise the price level and output in the economy 
B. Lower the price level and output in the economy 
C. Lower the price level in the economy
D. Raise the price level and lower output in the economy

Answer : C. Lower the price level in the economy

15- The biggest challenge for Pakistani’s economy in FY 2022-23 was:

A. Low literacy rate
B. Rising inflation
C. Low employment 
D. Current account deficit

Answer : B. Rising inflation

16- The aggregate demand curve slopes downward because of the:

A. Wealth effect 
B. Interest rate effect 
C. Exchange rate effect
D. All of these

Answer : D. All of these

17- Frictional unemployment often occurs when:

A. The economy enters a recession 
B. People first enter the labour force
C. People are discriminated against 
D. People lose a job because their skills are no longer needed

Answer : B. People first enter the labour force

18- A company has a cost function C(Q) = 2 Q² + 10Q + 50 . What is the marginal cost of producing the 11th unit of output?

A. $22
B. $30
C. $40
D. $54

Answer : B. $30

19- What is the Antonym of “Ubiquitous”?

A. Universal
B. Abundant
C. Pervasive
D. Scarce

Answer : D. Scarce

20- What synonym of “Lethargy” is:

A. Laxity
B. Serenity
C. Active
D. Bold

Answer : A. Laxity

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