1Any idea concerning'theory of random walk'?

2. Select the correct one/ones from the given list of statements using the code given below :

. Higher the priceearning ratio shares they have, higher the investment they are able to71attract.

. Shares with lower priceearning ratios attract lower investment.

. Lower the priceearning ratios, higher the investmemnts the shares are able to attract.

CODE :

(a) Only 1

(b) Only 2

(c) Only 3

(d) None of the above

3. Select the correct statement/statements which are correct as per the famous 'Say's Law'

using the code given below :

. Economic systems are 'supplyled'.

. All accruing income is to be spent.

. Aggregate supply creates its own aggregate demand in an economy.

CODE :

(a) 1 and 2

(b) 2 and 3

(c) 1 and 3

(d) 1, 2 and 3

4. Consider the statements given below and select those ones, which will be correct as per the

concept of 'Pigou effect'.

. Wealth effect on the economy.

. An increase is the real value of the money.

. Higher demand and higher employment.

CODE:

(a) 1 and 2

(b) 2 and 3

(c) 1 and 3

(d) 1, 2 and 3

from the finally increasing employment.

5. What is correct about the 'secondbest theory'?

6.

7. The World Trade Organization has a provision under which member countries need to cut

their trade tariff to zero in a phasedmanner for which the 'Swiss formula' is applied.

8. Consider the statements given below:

. WTO makes it obligatory for the member countries to rationalise their agriculture

subsidies.

. Some economies of Europe and America provide as high as 220 per cent subsidies to their

agriculture in the 'green box' while its level is just below 10 per cent in case of most of the

developing economies, that too including 'blue box'.

To rationalize such kind of subsidies which 'method' of 'subsidy cut' looks suitable?

9. Consider the following statements and select the correct one/ones about the 'Veblen effect'

using the code given below :

1. Consumers may have an 'upwardsloping demand curve' as opposed to a

'downwardsloping demand curve' because they practice conspicuous consumption.

2. Quantity demanded of a particular good varies directly with a change in price.

CODE:

(a) Only 1

(b) Only 2

(c) 1 and 3

(d) None of the above.

10. Select the policy decision/decisions a government should take to promote foreign

investments in the economy: