PMS Economics Past Paper 2024 PDF -

PUNJAB PUBLIC SERVICE COMMISSION

Combined Competitive Examination (CCE) 2024

For Recruitment to the Posts of Provincial Management Service (PMS)

SUBJECT: Economics

Time Allowed: 3 Hours

Maximum Marks: 100

SECTION – A

PAPER – I

NOTE:
i. All parts (if any) of each question must be attempted at one place instead of at different places.
ii. Write Q. No. in the Answer Book in accordance with Q. No. in the Question Paper.
iii. No page/space should be left blank between answers. All blank pages must be crossed.

PART – I

Q. No. 1

Explain the concept of Production Possibility Frontier (PPF). Discuss the concept of opportunity cost and its role in production decision-making.

a) Analyze points on, inside, and outside the PPF along with their economic implications.
b) Can the PPF have different shapes or slopes? Explain.

Q. No. 2

Differentiate between Cross Elasticity of Demand and Arc Elasticity of Demand.

a) Explain their economic implications with suitable examples.

Q. No. 3

Explain Cardinal and Ordinal Utility. Which approach is more appropriate for economic decision-making?

a) Draw the demand curve based on your explanation.
b) Does utility drive movement along the demand curve? Explain the role of consumer surplus.

Q. No. 4

Analyze the Consumer Consumption Curve (CCC) based on the budget line. What is the role of Marginal Rate of Substitution (MRS) in determining equilibrium?

a) Explain the Engel Curve (EC). Are Engel curves always straight, or can they have different slopes?
b) Identify the types of commodities for which Engel curves are negatively sloped.

Q. No. 5

Explain the factors of production and their employment. Establish the concept of expansion path and discuss the role of economies of scale.

a) Define the production function.
b) Draw a production possibility curve using two factors of production and show their substitution. Discuss the economic implications.

Q. No. 6

a) Explain the kinked demand curve and output determination under oligopoly.

b) Explain Cournot equilibrium and relate it to Nash equilibrium. How are these concepts useful in economic decision-making?

Part – II

Q. No. 7

Given the LM equation:

$MˉP=iR+kY\frac{\bar{M}}{P} = iR + kY$

Where:
$Mˉ\bar{M}$ = Money Supply, $P$ = Price Level, $r$ = Interest Rate, $Y$ = Income, $k > 0$ , $i < 0$

a) Solve for $drdY\frac{dr}{dY}$ .
b) Draw and interpret the LM curve.
c) Discuss equilibrium along the LM curve.
d) Explain factors affecting money supply and money demand.

Q. No. 8

a) How does an exponential function differ from a logarithmic function in the case of one independent variable?

b) Given the following IS-LM model:

$C = 15 + 0.8Y_d$ $I = 75 - 100 r$ $Y = C + I + G$ $Y_d = Y – T$ $T = 5 + 0.2 Y$ $G = 300$

Money Market:

$L_T = 0.2Y$ $L_S = 750 – 260r$ $M_S = 950$

Required:

Derive the IS curve
Derive the LM curve
Determine equilibrium income (Y) and interest rate (r)

Q. No. 9

a) What is the significance of derivatives in economics?

b) A monopolist firm faces the following two demand functions:

$Q_1 = 24 – 0.2P_1$ $Q_2 = 10 – 0.05P_2$

Determine the price charged by the firm:

With price discrimination
Without price discrimination

PUNJAB PUBLIC SERVICE COMMISSION

Combined Competitive Examination (CCE) 2024

For Recruitment to the Posts of Provincial Management Service (PMS)

SUBJECT: Economics

Time Allowed: 3 Hours

Maximum Marks: 100

SECTION – A

PAPER – I

NOTE:i. All parts (if any) of each question must be attempted at one place instead of at different places.ii. Write Q. No. in the Answer Book in accordance with Q. No. in the Question Paper.iii. No page/space should be left blank between answers. All blank pages must be crossed.

PART – I

Q. No. 1

Explain the concept of Production Possibility Frontier (PPF). Discuss the concept of opportunity cost and its role in production decision-making.

a) Analyze points on, inside, and outside the PPF along with their economic implications.b) Can the PPF have different shapes or slopes? Explain.

Q. No. 2

Differentiate between Cross Elasticity of Demand and Arc Elasticity of Demand.

a) Explain their economic implications with suitable examples.

Q. No. 3

Explain Cardinal and Ordinal Utility. Which approach is more appropriate for economic decision-making?

a) Draw the demand curve based on your explanation.b) Does utility drive movement along the demand curve? Explain the role of consumer surplus.

Q. No. 4

Analyze the Consumer Consumption Curve (CCC) based on the budget line. What is the role of Marginal Rate of Substitution (MRS) in determining equilibrium?

a) Explain the Engel Curve (EC). Are Engel curves always straight, or can they have different slopes?b) Identify the types of commodities for which Engel curves are negatively sloped.

Q. No. 5

Explain the factors of production and their employment. Establish the concept of expansion path and discuss the role of economies of scale.

a) Define the production function.b) Draw a production possibility curve using two factors of production and show their substitution. Discuss the economic implications.

Q. No. 6

a) Explain the kinked demand curve and output determination under oligopoly.

b) Explain Cournot equilibrium and relate it to Nash equilibrium. How are these concepts useful in economic decision-making?

Part – II

Q. No. 7

Given the LM equation:

MˉP=iR+kY\frac{\bar{M}}{P} = iR + kYPMˉ​=iR+kY

Where:Mˉ\bar{M}Mˉ = Money Supply, PPP = Price Level, rrr = Interest Rate, YYY = Income, k>0k > 0k>0, i<0i < 0i<0

a) Solve for drdY\frac{dr}{dY}dYdr​.b) Draw and interpret the LM curve.c) Discuss equilibrium along the LM curve.d) Explain factors affecting money supply and money demand.

Q. No. 8

a) How does an exponential function differ from a logarithmic function in the case of one independent variable?

b) Given the following IS-LM model:

C=15+0.8YdC = 15 + 0.8Y_dC=15+0.8Yd​ I=75−100rI = 75 – 100rI=75−100r Y=C+I+GY = C + I + GY=C+I+G Yd=Y−TY_d = Y – TYd​=Y−T T=5+0.2YT = 5 + 0.2YT=5+0.2Y G=300G = 300G=300

Money Market:

LT=0.2YL_T = 0.2YLT​=0.2Y LS=750−260rL_S = 750 – 260rLS​=750−260r MS=950M_S = 950MS​=950

Required:

Derive the IS curve

Derive the LM curve

Determine equilibrium income (Y) and interest rate (r)

Q. No. 9

a) What is the significance of derivatives in economics?

b) A monopolist firm faces the following two demand functions:

Q1=24−0.2P1Q_1 = 24 – 0.2P_1Q1​=24−0.2P1​ Q2=10−0.05P2Q_2 = 10 – 0.05P_2Q2​=10−0.05P2​

Determine the price charged by the firm:

With price discrimination

Without price discrimination

Leave a Reply Cancel reply

NOTE:
i. All parts (if any) of each question must be attempted at one place instead of at different places.
ii. Write Q. No. in the Answer Book in accordance with Q. No. in the Question Paper.
iii. No page/space should be left blank between answers. All blank pages must be crossed.

a) Analyze points on, inside, and outside the PPF along with their economic implications.
b) Can the PPF have different shapes or slopes? Explain.

a) Draw the demand curve based on your explanation.
b) Does utility drive movement along the demand curve? Explain the role of consumer surplus.

a) Explain the Engel Curve (EC). Are Engel curves always straight, or can they have different slopes?
b) Identify the types of commodities for which Engel curves are negatively sloped.

a) Define the production function.
b) Draw a production possibility curve using two factors of production and show their substitution. Discuss the economic implications.

$MˉP=iR+kY\frac{\bar{M}}{P} = iR + kY$

Where:
$Mˉ\bar{M}$ = Money Supply, $P$ = Price Level, $r$ = Interest Rate, $Y$ = Income, $k > 0$ , $i < 0$

a) Solve for $drdY\frac{dr}{dY}$ .
b) Draw and interpret the LM curve.
c) Discuss equilibrium along the LM curve.
d) Explain factors affecting money supply and money demand.

$C = 15 + 0.8Y_d$ $I = 75 - 100 r$ $Y = C + I + G$ $Y_d = Y – T$ $T = 5 + 0.2 Y$ $G = 300$

$L_T = 0.2Y$ $L_S = 750 – 260r$ $M_S = 950$

$Q_1 = 24 – 0.2P_1$ $Q_2 = 10 – 0.05P_2$