JAM 2022 ECONOMICS - EN

Section A: Q.1 – Q.10 Carry ONE mark each.

Q.1 When the supply curve 𝑆𝑥 is backward bending and the demand curve 𝐷𝑥 is downward
sloping as shown in the figure, there are two equilibria 𝑀 and 𝑁, respectively. Which of
the following statements is CORRECT?

(A) Only 𝑀 is stable equilibrium

(B) Only 𝑁 is stable equilibrium

(C) Both 𝑀 and 𝑁 are stable equilibria

(D) Both 𝑀 and 𝑁 are unstable equilibria

EN 2/48
JAM 2022 ECONOMICS - EN

Q.2 Which of the following deficits indicates the true current fiscal position of the Indian
Economy?

(A) Revenue Deficit

(B) Capital Deficit

(C) Current Account Deficit

(D) Primary Deficit

EN 3/48
JAM 2022 ECONOMICS - EN

Q.3 Which of the following CORRECTLY defines the relationship between the variances of
sample means for simple random samples drawn with and without replacement from a
normal population?

(A) 2 2  N n
  
n n  N 1 

(B) 2 2  N n
  
n n  N 1 

(C) 2 2  N n
  
n n  N 1 

(D) 2 2  N n
  
n n  N 1 

EN 4/48
JAM 2022 ECONOMICS - EN

Q.4 Suppose that one million unemployed persons in a country are receiving Rs. 6000 per
month per person as an unemployment allowance. If the government, instead of paying
unemployment allowance, hires all of them at the same amount (Rs. 6000 per month per
person) and engages them in digging the pits and filling the same pits. What will be the
effect on GDP?

(A) No effect on GDP

(B) GDP will rise.

(C) GDP will fall.

(D) The effect on GDP will be uncertain.

EN 5/48
JAM 2022 ECONOMICS - EN

Q.5 Which amendments to the constitution have provided constitutional status to the rural and
urban local bodies in India?

(A) 80th and 81st Amendments

(B) 73rd and 74th Amendments

(C) 92nd and 93rd Amendments

(D) 71st and 72nd Amendments

EN 6/48
JAM 2022 ECONOMICS - EN

Q.6 Let W be a subspace of a vector space 3 . Then, which of the following sets of vectors
forms a basis of W?

(A) (1, 2, 1) and (1,  2, 5)

(B) (1, 3, 2), (1, 1, 0), (4, 1, 0) and (3, 1,  3)

(C) (1, 1, 1), (1, 2, 3) and (2, 1, 1)

(D) (1,  2, 1), (2, 1, 1) and (7,  4, 1)

EN 7/48
JAM 2022 ECONOMICS - EN

Q.7 From the following, who first examined the close negative relationship between the
unemployment rate and the output ratio?

(A) Alban W. Phillips

(B) James Tobin

(C) Arthur M. Okun

(D) Robert M. Solow

Q.8 In the hypothesis testing, which of the following defines the size of power of the test?

(A) 1 – (Probability of accepting null hypothesis when it is true)

(B) 1 – (Probability of rejecting null hypothesis when it is true)

(C) 1 – (Probability of accepting null hypothesis when it is false)

(D) 1 + (Probability of rejecting null hypothesis when it is not true)

EN 8/48
JAM 2022 ECONOMICS - EN

Q.9 Which of the following is NOT a postulate of the Classical Model of full-employment
equilibrium?

(A) Wage-Price flexibility

(B) Perfect information about the market

(C) Consumption and saving functions depend on income.

(D) The price level moves proportionately with the quantity of money.

Q.10 A long-run cost function for a product exhibits economies of scale if

(A) average cost of production increases when the output increases.

(B) the production function has decreasing returns to scale.

(C) average cost of production falls as the output increases.

(D) average cost of production remains constant as the output increases.

EN 9/48
JAM 2022 ECONOMICS - EN

Section A: Q.11 – Q.30 Carry TWO marks each.

Q.11 dy d2y
Let x3  3 y 2  4 for all x, y , y  and y  . Then
dx dx 2

(A) x 2  y y  ( y)2  0

(B) 2 x  y  2( y)2  0

(C) x  ( y)2  0

(D) x  y y  ( y)2  0

EN 10/48
JAM 2022 ECONOMICS - EN

Q.12 Match List I with List II and choose the CORRECT option.

List I List II

a. Second Five Year Plan (1956-61) i. Towards Faster and More

Inclusive Growth

b. Fourth Five Year Plan (1969-74) ii. Removal of Poverty and

Attainment of Self-reliance

c. Fifth Five Year Plan (1974-79) iii. Rapid Industrialization–Heavy

and Basic Industries

d. Eleventh Five Year Plan (2007-12) iv. Family Planning Programmes

(A) (a, ii), (b, i), (c, iv), (d, iii)

(B) (a, iii), (b, iv), (c, i), (d, ii)

(C) (a, iv), (b, iii), (c, ii), (d, i)

(D) (a, iii), (b, iv), (c, ii), (d, i)

EN 11/48
JAM 2022 ECONOMICS - EN

x 1
Let f : 0,     be a function defined by f ( x) 
Q.13
for all x. Then f is
x2

(A) one-one and onto.

(B) one-one but not onto.

(C) onto but not one-one.

(D) neither one-one nor onto.

EN 12/48
JAM 2022 ECONOMICS - EN

Q.14 An economy is characterized by the Solow model, with the production function y  k,
where y is output per worker and k is capital per worker. The steady-state level of output
𝛾 𝛼/(1−𝛼)
per worker is 𝑦 𝑠𝑠 = 𝐴1/(1−𝛼) (𝛿 ) , where A,  ,  and  denote productivity,

share of output invested (in %), depreciation rate (in %) and capital’s share in income (in
fraction), respectively. Suppose that A = 1, k = 400,  = 50%,  = 5% and   1/ 2.
Then the current output, using the above information, is

(A) above the steady-state level of output per worker.

(B) at the steady-state level of output per worker.

(C) below the steady-state level of output per worker.

(D) at the Golden Rule level.

EN 13/48
JAM 2022 ECONOMICS - EN

Q.15 Which of the following is NOT related to the structural adjustment programmes
implemented in India after 1991?

(A) Deregulation

(B) Quantitative restrictions on trade

(C) Fiscal austerity

(D) Reduction of subsidies

EN 14/48
JAM 2022 ECONOMICS - EN

Q.16 Let a second order difference equation be

yn 2  4 yn  4 yn1 , n  2, 3, 4,... , y0  1, y1  4 .

Then the general solution is

(A) (1  n 2 ) 2n

(B) (1  n ) 2n

(C)  1 n
1  2
 n

(D) ( n2  n  1) 2n

EN 15/48
JAM 2022 ECONOMICS - EN

Q.17 Suppose that two random samples of sizes n1 and n2 are selected without replacement

from two binomial populations with means 1  n1 p1 , 2  n2 p2 and variances

 12  n1 p1q1 ,  22  n2 p2 q2 , respectively. Let the difference of sample proportions

P1 and P2 approximate a normal distribution with mean ( p1  p2 ). Then the standard

deviation of the difference of sample proportions P1 and P2 is

(A)
 p1 q1   N1  n1   p2 q2  N 2  n2 
     
 1  1
n N  1   n2  N 2  1 

(B)
 p1 q1   p2 q2 
  
 n1   n2 

(C)
 p1 q1  p2 q2 
 
 n1  n2 

(D)
 p1 q1   N1  n1   p2 q2   N 2  n2 
    
 n1  n2   N1  1   n1  n2   N 2  1 

EN 16/48
JAM 2022 ECONOMICS - EN

Q.18 Which of the following statements is NOT correct in the context of quantity theory of
money?

(A) The quantity of money available determines the price level in the economy.

(B) The growth rate in the quantity of money available determines the inflation rate in the
economy.

(C) The velocity of money must rise with the increase in the quantity of money in the economy.

(D) The economy’s output is determined by factor supplies and technology, because money is
neutral.

EN 17/48
JAM 2022 ECONOMICS - EN

Q.19 x y2
Let the function f : 2   be f ( x, y )  , f (0, 0)  0 . Then
x3  2 x 2 y  y 3

(A) f is differentiable at (0, 0).

(B) f x does not exist at (0, 0).

(C) f y does not exist at (0, 0).

(D) f is not continuous at (0, 0).

EN 18/48
JAM 2022 ECONOMICS - EN

Q.20 Which of the following measures was announced by the Government of India in the year
1994?

(A) Full convertibility on capital account

(B) Full convertibility on current account

(C) Constitution of the Narasimham Committee on banking sector reforms

(D) Constitution of the Abid Hussain Committee on trade policies

EN 19/48
JAM 2022 ECONOMICS - EN

Q.21 An analyst at the Green Car Co. Ltd. estimated the following demand function for the
electric vehicles it sells:

𝑄𝐸 = 0.75 − 1.5𝑃𝐸 + 2.5𝑃𝐹 − 0.5𝑃𝐵 + 3.2 𝐼

where 𝑄𝐸 = Number of electric vehicles (in thousand per year), 𝑃𝐸 = Unit price of electric
vehicle (Rs. in Lakh), 𝑃𝐹 = Average unit price of vehicle using fossil fuels (Rs. in Lakh),
𝑃𝐵 = Unit price of battery used in electric vehicle (Rs. in Lakh), 𝐼 = Personal disposable
income (Rs. in Lakh).

Let 𝑃𝐸 = Rs. 6.5 Lakh, 𝑃𝐹 = Rs. 4.5 Lakh, 𝑃𝐵 = Rs. 0.5 Lakh and 𝐼 = Rs. 10 Lakh. Then
the income elasticity of demand (𝑒𝑄𝐸 𝐼 ) and the cross price elasticity of demand (𝑒𝑄𝐸 𝑃𝐹 )
satisfy

(A) 0.98 ≤ 𝑒𝑄𝐸 𝐼 ≤ 0.99 and 0.33 ≤ 𝑒𝑄𝐸 𝑃𝐹 ≤ 0.34

(B) 0.94 ≤ 𝑒𝑄𝐸 𝐼 ≤ 0.95 and 0.45 ≤ 𝑒𝑄𝐸 𝑃𝐹 ≤ 0.46

(C) 0.98 ≤ 𝑒𝑄𝐸 𝐼 ≤ 0.99 and 0.45 ≤ 𝑒𝑄𝐸 𝑃𝐹 ≤ 0.46

(D) 0.94 ≤ 𝑒𝑄𝐸 𝐼 ≤ 0.95 and 0.33 ≤ 𝑒𝑄𝐸 𝑃𝐹 ≤ 0.34

EN 20/48
JAM 2022 ECONOMICS - EN

Q.22 Choose the option that represents the original linear programming problem based on the
initial simplex tableau given below, where Si represents slack/surplus variables and Ai
represents the artificial variables corresponding to the ith constraint:

Cj 15 25 0 –M –M 0
Xb b x y S1 A1 A2 S3
–M A1 20 7 6 –1 1 0 0
–M A2 18 3 –2 0 0 1 0
0 S3 30 8 5 0 0 0 1
Zj – 38M – 10M – 4M M –M –M 0
Cj – Zj 15 + 10M 25 + 4M –M 0 0 0

(A) Minimize Z=15x  25 y

subject to 7 x  6 y  20, 3x  2y  18, 8 x  5 y  30 ; x, y  0.

(B) Maximize Z=15x  25 y

subject to 7 x  6 y  20, 3x  2y  18, 8x  5 y  30 ; x, y  0.

(C) Minimize Z=15x  25 y

subject to 7 x  6 y  20, 3x  2y  18, 8 x  5 y  30 ; x, y  0.

(D) Maximize Z=15x  25 y

subject to 7x  6 y  20, 3x  2y  18, 8x  5 y  30 ; x, y  0.

EN 21/48
JAM 2022 ECONOMICS - EN

Q.23 Let a production function be given by

𝛽
log 𝑄 = log(𝐿𝛼 + 𝐾 𝛼 ) , where 𝛼 ∈ (−∞, 1] − {0} and 𝛽 > 0.
𝛼

Then identify the statement that is NOT correct.

(A) The ratio 𝛽/𝛼 helps in identification of returns to scale factors.

(B) For 𝛽 > 1, the function exhibits increasing returns to scale, and for 𝛽 < 1, it shows
decreasing returns to scale.

(C) The elasticity of substitution is 1

.
1−𝛼

(D) The elasticity of substitution is 1

.
1−𝛽

EN 22/48
JAM 2022 ECONOMICS - EN

Q.24 Which of the following statements is NOT correct under the IS-LM (Fixed Price) model?

(A) The LM curve represents the combinations of income and interest rate, where money
market is in equilibrium.

(B) The IS curve represents the combinations of income and interest rate, where product
market (goods and services) is in equilibrium.

(C) An increase in money supply raises income and reduces interest rate when the IS curve
has negative slope and the LM curve has positive slope.

(D) Monetary policy has a relatively weak effect on income when the interest responsiveness
of the demand for money is relatively low.

EN 23/48
JAM 2022 ECONOMICS - EN

Q.25 2
The probability of getting head in a toss of a biased coin is . Let the coin be tossed three
3
times independently. Then the probability of getting head in the first two tosses and tail in
the final toss is

(A) 4
27

(B) 1
8

(C) 2
27

(D) 23
27

EN 24/48
JAM 2022 ECONOMICS - EN

Q.26 Consider a pure exchange economy with two goods 𝑥 and 𝑦. Ravi and Suraj are two
𝑥 𝛼
individuals with utility functions 𝑈𝑅 = 𝛽 log(𝑥𝑦) and 𝑈𝑆 = (𝑦) , respectively. The

endowments are 𝑥𝑅 and 𝑦𝑅 for Ravi and 𝑥𝑆 and 𝑦𝑆 for Suraj such that 𝑥𝑅 + 𝑥𝑆 = 𝐴 and
𝑦𝑅 + 𝑦𝑆 = 𝐵. Then their contract curve is

(A) 𝐴𝑦𝑅 − 𝐵𝑥𝑅 = 0

(B) 𝐴𝑦𝑅 + 𝐵𝑥𝑅 − 2𝑦𝑅 𝑥𝑅 = 0

(C) 𝐴𝑦𝑅 + 𝐵𝑥𝑅 − 𝑦𝑅 𝑥𝑅 = 0

(D) 𝐴𝑦𝑅 − 𝐵𝑥𝑅 + 2𝑦𝑅 𝑥𝑅 = 0

EN 25/48
JAM 2022 ECONOMICS - EN

Q.27 Which of the following is NOT correct regarding R-squared ( R2 ) and

Adjusted R-squared  R 2  ?

(A) R 2 is a scale invariant statistic.

(B) R 2 is always positive.

(C) R 2 tends to increase if we add an additional explanatory variable.

 n 1 
 
(D)
R 2 = 1  1  R2   , where k is the number of parameters and n is the number of
 nk 
observations.

EN 26/48
JAM 2022 ECONOMICS - EN

Q.28 The technical change in the endogenous growth model is endogenized by

(A) providing incentives to firms to innovate.

(B) making the saving function dependent on income.

(C) introducing constraints in capital accumulation.

(D) assuming a perfectly competitive market structure.

EN 27/48
JAM 2022 ECONOMICS - EN

Q.29 Which of the following statements is CORRECT for Game A and Game B?

Game A: Mary wants to watch a movie Game B: The Prisoner’s dilemma problem is
and John is interested in watching a shown below:
football match. Both wish to be
Convict 2
together. The payoff matrix is: Do not
confess Confess

Convict 1
John Do not confess (-1,-1) (-9,0)
Movie Football
Confess (0,-9) (-5,-5)
Mary

Movie (2,1) (0,0)

Football (0,0) (1,2)

(A) In Game A, (Movie, Football) and (Football, Movie) represent Nash equilibrium.
In Game B, (Do not confess, Do not confess) is the Nash Equilibrium.

(B) In Game B, (Confess, Confess) is not a Nash equilibrium but in Game A, both (Movie,
Football) and (Football, Movie) represent Nash equilibrium.

(C) In Game B, the Nash equilibrium is (Do not confess, Do not confess).

(D) In Game A, both (Movie, Movie) and (Football, Football) represent Nash equilibrium.
In Game B, the Nash equilibrium is (Confess, Confess).

EN 28/48
JAM 2022 ECONOMICS - EN

Q.30 The short-run production function of a firm is 𝑄 = 200 + 0.2𝐿2 − 0.0004𝐿3 . If wage rate
equals Rs. 140 and the number of labours (𝐿) is 100, then the Marginal Cost and the
Average Variable Cost, respectively, are

(A) 5 and 7.78

(B) 6 and 7.78

(C) 5 and 6.68

(D) 6 and 6.68

EN 29/48
JAM 2022 ECONOMICS - EN

Section B: Q.31 – Q.40 Carry TWO marks each.

Q.31 Let X N   X ,  X2  and Y N  Y ,  Y2  . Which of the following is/are NOT correct?

(A) X 
1  X X 
 
2

1
e
2  X 
The area F ( X )  dx is 1.
 X 2 

(B) The areas under the normal probability curve between the ordinates at  X  3 X and

Y  2 Y are 0.9544 and 0.9973, respectively.

(C) For variable X,

2 4
Quartile Deviation : Mean Absolute Deviation : Standard Deviation   X :  X : X
3 5

(D) If X and Y are independent, then ( X  Y ) N   X  Y ,  X2   Y2  .

EN 30/56
JAM 2022 ECONOMICS - EN

Q.32 Matching List I and List II, choose the CORRECT option(s).

List I List II
a. Bombay Plan i. J. P. Narayan
b. People’s Plan ii. J. R. D. Tata
c. Sarvodaya Plan iii. M. N. Roy

(A) (a, i), (b, iii)

(B) (a, ii), (b, iii)

(C) (b, iii), (c, i)

(D) (a, ii), (c, iii)

EN 31/48
JAM 2022 ECONOMICS - EN

Q.33 Suppose that the regression model is Yi  0  1 X 1i   2 X 2i  i , i = 1, 2, …, n. Which of

the following null hypotheses could be tested using the F-test?

(A) 𝛽1 /𝛽2 = 0

(B) 0  0

(C) 1  2  0

(D) 1   2  0

EN 32/48
JAM 2022 ECONOMICS - EN

Q.34     
Let f be defined by f ( x) = x  cos   x  , x    ,  . Then
2   2 2

(A)      
f is continuous on   , 0   0,  .
 2   2 

(B) f is differentiable at x  0 .

(C) f is differentiable everywhere except x  0 .

(D) lim f ( x)  0 .
x 0

EN 33/48
JAM 2022 ECONOMICS - EN

Q.35 The real exchange rate is given by 𝑒 = 𝐸𝑃/𝑃⋆ , where 𝑒 is the price of domestic goods in
terms of foreign goods, 𝐸 is the price of domestic currency in terms of foreign currency,
𝑃 is the domestic price level, 𝑃⋆ is the foreign price level. If the Indian Rupee depreciates
vis-à-vis the Japanese Yen, and the Marshall-Lerner condition holds, then

(A) India’s imports will increase.

(B) India’s trade balance will improve.

(C) foreign demand for Indian goods will increase.

(D) foreign demand for Indian goods will decrease.

EN 34/48
JAM 2022 ECONOMICS - EN

Q.36 The demand function (𝑄𝑥𝐷 ) and supply function (𝑄𝑥𝑆 ) are given as:

𝑄𝑥𝐷 = 𝑓(𝑃𝑥 , 𝐼) and 𝑄𝑥𝑆 = 𝑔(𝑃𝑥 , 𝐴)

where 𝐼 (Income) and A (Advertisement expenses) are the exogenous factors affecting
∂𝑓 𝜕𝑔 𝜕𝑓
quantity demanded and supplied, respectively. Further, < 0, > 0 but and
𝜕𝑃𝑥 𝜕𝑃𝑥 𝜕𝐼
𝜕𝑔
may have any sign. Considering that there exists an equilibrium (𝑄𝑥𝐷 = 𝑄𝑥𝑆 = 𝑄),
𝜕𝐴
which of the following is/are CORRECT?

(A) 𝑒 𝜕𝑔 𝐴 𝜕𝑓 𝑃𝑥 𝜕𝑔 𝑃𝑥
𝑃𝑥 𝐴 = (𝜕𝐴 𝑄 )⁄(𝜕𝑃 − )
𝑥 𝑄 𝜕𝑃𝑥 𝑄

(B) 𝑑𝑃𝑥 ∂𝑔 ∂𝑓 ∂𝑔
= (∂𝐴)⁄(∂𝑃 − )
𝑑𝐴 𝑥 ∂𝑃𝑥

(C) 𝑒 = (𝜕𝑔 𝐼 )⁄( 𝜕𝑓 𝑃𝑥

−
𝜕𝑔 𝑃𝑥
)
𝑃𝑥 𝐼 𝜕𝐼 𝑄 𝜕𝑃 𝑥 𝑄 𝜕𝑃𝑥 𝑄

(D) The sign of 𝑑𝑃𝑥 𝜕𝑔

does not depend on .
𝑑𝐴 𝜕𝐴

EN 35/48
JAM 2022 ECONOMICS - EN

Q.37 Which of the following statements is/are CORRECT under the Keynesian Cross (Fixed
Price) Model?

(A) The product market and factor market independently determine the full-employment level
of output.

(B) Output is determined in the product market by the aggregate expenditure.

(C) Money market determines the price level, given the quantity of money and the level of
output.

(D) Employment is determined in the factor market by the output level determined in the
product market.

EN 36/48
JAM 2022 ECONOMICS - EN

Q.38 Which of the following functions is/are homogeneous?

(A)  y
x cot 1  
x

(B) x 3x
 7
y y

(C) x3  y 3
3x  4 y

(D) 3x5 y  2 x 2 y 4  3x 3 y 4

EN 37/48
JAM 2022 ECONOMICS - EN

Q.39 In the context of Indian agriculture, which of the following statements is/are CORRECT?

(A) NABARD was established in 1982.

(B) One of the objectives of setting up of the CACP was to ensure remunerative prices to
farmers.

(C) The APMC Act is related to institutional credit supply in agriculture.

(D) The National Commission on Agriculture was chaired by V. M. Dandekar.

EN 38/48
JAM 2022 ECONOMICS - EN

Q.40 Let a monopolist demand curve be given by 𝑄 = 𝑃 𝑒 , where 𝑄 is output, 𝑃 is price, 𝑒 is

the price elasticity of demand (𝑒 < −1), and Marginal Cost = Average Cost = 𝛼. If 𝑃𝐶 and
𝑃𝑀 represent the price under perfect competition and monopoly, respectively, then which
of the following is/are NOT correct?

(𝐶𝑆𝑀 and 𝐶𝑆𝐶 represent the consumer surplus under monopoly and perfect competition,
respectively.)

(A) 𝑃 = 𝛼 ( 𝑒 )
𝐶
1+𝑒

(B) 𝑃 = 𝛼 ( 𝑒 )
𝑀
1+𝑒

(C) For 𝑒 = − 2, 𝐶𝑆𝑀 = 𝐶𝑆𝐶 .

(D) For 𝑒 closer to −1, the ratio 𝐶𝑆𝑀 /𝐶𝑆𝐶 increases.

EN 39/48
JAM 2022 ECONOMICS - EN

Section C: Q.41 – Q.50 Carry ONE mark each.

Q.41 The sum of the eigen values of the square matrix

 1 1 3
 
 1 5 1  is _______ (in integer).
 3 1 1
 

Q.42 Monthly per capita consumption expenditure (MPCE) of 10 households in a region is given
below.

Households H1 H2 H3 H4 H5 H6 H7 H8 H9 H10
MPCE
2800 3000 1200 3500 1400 2500 4000 1000 900 1300
(in Rs.)

Assuming the poverty cutoff (Z) of MPCE to be Rs. 2000, the squared poverty gap ratio is
_______ (round off to 3 decimal places).

Q.43 Suppose that the full employment level of output of an economy is Rs. 2200 million,
expenditure determined level of output is Rs. 2163 million, and the marginal propensity to
consume is 0.75. The deflationary gap equals Rs. _______ million (round off to 2 decimal
places).

EN 40/48
JAM 2022 ECONOMICS - EN

Q.44 Let a, b. If f ( x)  ax  b is such that

a  b  4 and f ( x  y )  f ( x)  f ( y )  2 for all x, y ,

50
then  f (n)  _______ (in integer).
n 1

Q.45 The Total Variable Cost (TVC) for a firm is given by 𝑇𝑉𝐶 = 𝑥 3 − 𝑏𝑥 2 . The Total Fixed
Cost is 848.

The value of 𝑏 for which the Marginal Cost is minimum at 𝑥 = 16 is _______ (in integer).

Let the consumption function, tax function, and income identity be given by
Q.46
𝐶 = 𝐶0 + 𝑏(𝑌 − 𝑇), 𝑇 = 𝑇0 + 𝑡𝑌, and 𝑌 = 𝐶 + 𝐼0 + 𝐺0 , respectively, where 𝐶0 , 𝐼0 ,
𝐺0 , and 𝑇0 are autonomous consumption, investment, government expenditure, and tax,
respectively. If 𝑏 = 0.75 and 𝑡 = 0.1, then an increase in 𝐺0 by Rs. 20 million will
increase 𝑌 by Rs. _______ million (round off to 2 decimal places).

EN 41/48
JAM 2022 ECONOMICS - EN

Q.47 Let the system of equations be u  w  0, u  v  0, v   w  0 , where   . Then

the system has infinite solutions if   _________ (in integer).

Q.48 Assume that the cost function for the 𝑖 𝑡ℎ firm in an industry is given by

𝐶𝑖 = 0.25𝑞𝑖2 + 2𝑞𝑖 + 5, 𝑖 = 1, 2, … , 150,

where 𝐶𝑖 and 𝑞𝑖 are cost and output for the 𝑖 𝑡ℎ firm, respectively.

Let the aggregate inverse demand function be 𝑃 = 10 − 0.01𝑄, where 𝑃 is the unit price
and 𝑄 is the aggregate output.

Assuming perfect competition, the equilibrium quantity is _________ (in integer).

EN 42/48
JAM 2022 ECONOMICS - EN

Q.49 The following table presents the national income related aggregates (at current prices) for
the year 2019-20:

Rs. Lakh
National income related aggregates
Crores
Net factor income earned abroad 10
Private income 175
GNP at factor cost 210
NNP at factor cost 195
Retained earnings of Nation’s private sector 10
Corporate tax 25
Household direct tax 28
Personal income 140
Miscellaneous receipts of government administrative departments 0

The personal disposable income for the year 2019-20 is Rs. _________ Lakh Crores (in
integer).

EN 43/48
JAM 2022 ECONOMICS - EN

Q.50 The following table provides a list of countries selling Big Mac and market exchange rates
in January 2019.

Big Mac Market Exchange Rate

Country
(Price in local currency) (Local currency per USD)
United States 5.58 USD 1.00
Norway 50.00 Kroner 8.53 Kroner/USD
Japan 390.00 Yen 108.44 Yen/USD
Mexico 49.00 Pesos 17.31 Pesos/USD
China 20.90 Yuan 6.85 Yuan/USD
Russia 110.17 Rubles 66.69 Rubles/USD
India 178.00 Rupees 69.69 Rupees/USD

Using the above information, the cheapest price (in USD) of Big Mac is _________
(round off to 2 decimal places).

EN 44/48
JAM 2022 ECONOMICS - EN

Section C: Q.51 – Q.60 Carry TWO marks each.

Q.51 An individual faces an uncertain prospect, where wealth could be Rs. 10 Lakh with
probability 0.75 and Rs. 7 Lakh with probability 0.25.

Let the utility function be 𝑈(𝑤) = 𝑤 3 . Then the individual will buy full insurance by
paying a premium of Rs. _________ Lakh (round off to 2 decimal places).

Q.52 Suppose that per capita GDP of India and USA are growing at annual average rates of
8.8% and 1.8%, respectively. Further, consider that in 2019-20, per capita GDP of USA
was USD 41099 and per capita GDP of India was USD 1570. Assuming that the two
countries continue to grow at the above rates, India’s per capita GDP will be equal to the
per capita GDP of USA in _________ years (round off to 2 decimal places).

Q.53  2  t2  t2
If   t 
t log 1  dt  g (t ) 
2
 2 

 f (t )
2
 Kt  C , where C is an arbitrary constant,

then 2K is _________ (in integer).

EN 45/48
JAM 2022 ECONOMICS - EN

Q.54 ACD Bank holds a total deposit of Rs. 256412. To expand the money supply in the
economy during the COVID-19 pandemic period, the Reserve Bank of India reduces the
cash reserve ratio (CRR) from 4.5% to 3.5%. Due to this policy change, the additional
money supply generated by ACD Bank is Rs. _________ (in integer).

Q.55 Suppose that the regression model is Y X  U with

n 1 n  3 3 1 n 1
T
       . A random sample of size n = 23 on Y and X is drawn from the
3 1  1 2 3 
normal population. Using the data, if a researcher obtains

0.3 0.5 0.8

( X X )  0.4  0.6
T 1
0.2  , X T Y  0.3 0.2 0.1 T and eT e  0.7 ,
0.4 0.5 0.3

where e denotes the vector of estimated residuals, then the t-statistic to test the null
hypothesis   0 is _________ (round off to 2 decimal places).
3

Q.56 Given the production function 𝑄 = 6√𝐿 and the supply of labour 𝐿 = √𝑤, where 𝐿 and w
denote the number of labours and wage rate, respectively. If the unit price of the product
is Rs. 243, then the profit maximizing value of 𝑤 is Rs. _________ (in integer).

EN 46/48
JAM 2022 ECONOMICS - EN

Q.57 Given the following information related to product and money markets,

Product Market Money Market

𝑀𝑜
𝐶 = 300 + 0.8(𝑌 − 𝑇) = 0.4𝑌 − 200𝑖
𝑃
𝑇 = 200 + 0.2(𝑌)
𝑀0 = 900; 𝑃 = 1 (Fixed)
𝐼0 = 300; 𝐺0 = 400

where 𝑌 = Income, 𝐶 = Consumption, 𝑇 = Tax, 𝐼0 = Autonomous Investment,

𝐺0 = Autonomous Government Expenditure, 𝑀0 = Nominal Money Demand, 𝑃 = Price,
and 𝑖 = Interest Rate.

The equilibrium level of interest rate (in %) is _________ (round off to 2 decimal places).

Q.58 Let the linear programming problem be

Maximize Z   0.2 x1  x2
subject to 2 x1  5 x2  70,
x1  x2  20,
x1 , x2  0.

If x1  a and x2  b is the optimal solution, then a  b  _________ (in integer).

EN 47/48
JAM 2022 ECONOMICS - EN

Q.59 Let the production function be 𝑄 = √𝐿2 + 𝐾 2 , the unit price of labour (𝐿) and
capital (𝐾) be Rs. 30 and Rs. 40, respectively, and the total cost be Rs. 580. Then the
maximum value of 𝑄 subject to the cost constraint is _________ (round off to 2 decimal
places).

Q.60 In a market, two firms 𝐹1 and 𝐹2 are producing homogenous products. The inverse demand
function is given by 𝑝 = 120 − 0.5(𝑞1 + 𝑞2 ), where 𝑝 is the unit price of the product,
and 𝑞1 and 𝑞2 are the outputs from 𝐹1 and 𝐹2 , respectively. Suppose the cost functions of
𝐹1 and 𝐹2 are 𝐶1 = 20𝑞1 and 𝐶2 = 10 + 0.5𝑞22 , respectively. Then the total profit earned
by both the firms assuming a competitive situation is _________ (in integer).

EN 48/48