Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET No 10: Sample Solutions
1) The rate of unemployment is the number of unemployed as a % of the total labour force. The labour force is
those adults (aged 15 or older) either already employed one hour or more per week or are able to star
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET No 10
Due at the beginning of your tutorial in week 12 so make sure you make a copy.
Note: To celebrate that were close to finishing the semester, and provide you with an extra
incentive to put effort into this problem set, we decided
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET No 9
(due at the beginning of your tutorial in week 11 so make sure you make a copy)
PART A
1) Compare and contrast human capital, H, and physical capital, K. How is H different from labour, L?
2) What is the implication of the diminis
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET No 9: SAMPLE SOLUTIONS
1) Both human capital H and physical capital K are factors of production (as is labour L). Human capital H is
the knowledge and skills that workers acquire through education, training and experience, and is owned
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 8: SAMPLE SOLUTIONS
1) The expenditure approach is based on payment flows into businesses, the income approach is based on
payments made by (out of) businesses, and the production (or valueadded) approach is an industrybyindustry
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 7: Solutions
PART A:
1) Figure 1 shows that although high prices cause an industry to expand, entry into the industry eventually
returns prices to the point of minimum average total cost. In the figure, the industry is originally in
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE SOLUTION TO PROBLEM SET NO 5
(due at the beginning of your tutorial in week 6 so make sure you make a copy)
ASSESSMENT:
Answer all questions. Each question in part A and subquestion in part B is worth the same. For detailed
assessment criteria se
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET No 8
(due at the beginning of your tutorial in week 10 so make sure you make a copy)
Make sure to check out our Competition 1 (the details are at the end of week 9 slides).
PART A:
1) Discuss the three ways in which the gross domestic
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE SOLUTION TO PROBLEM SET NO 4
1) When the price of beer rises, the quantity of beer demanded decreases. Since beer and pies are
complements, other things remaining the same, people now want to buy fewer pies. The demand curve for
pies shifts to the
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 7
(IMPORTANT: Please note that this PS is due at the beginning of your tutorial in week 9, not week 8. As
explained, the task for the tute in week 8 (PS6) is to carefully redo the midsemester exam in writing.
ASSESSMENT:
Answer al
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 5
(due at the beginning of your tutorial in week 6 so make sure you make a copy)
ASSESSMENT:
Answer all questions. Each question in part A and subquestion in part B is worth the same. For detailed
assessment criteria see the subjec
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 4
(due at the beginning of your tutorial in week 5 so make sure you make a copy)
ASSESSMENT:
Answer all questions. Each question in part A and subquestion in part B is worth the same. For detailed
assessment criteria see the subjec
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 3
(due at the beginning of your tutorial in week 4 so make sure you make a copy)
ASSESSMENT:
Answer all questions. Each question in part A and subquestion in part B is worth the same. For detailed
assessment criteria see the subjec
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 1: SAMPLE SOLUTIONS
Note: Reading the posted solutions every week will give you a good idea of what type of answers
(that express your understanding) we are after. In some cases the posted solutions will provide
additional informati
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 3: SAMPLE SOLUTIONS
1) Elimination of dominated strategies is a stronger equilibrium concept as it is concerned with the
whole strategies, not just the particular outcome. A dominated strategy never gives the unique
best payoff, whi
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 2: SAMPLE SOLUTIONS
1) If strategy A is strictly dominant over B, then the payoff of playing A is always (i.e. for any play of
the opponent) higher than from playing B. In such can we can also say that B is strictly dominated
by A.
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 1
(due at the beginning of your tutorial in week 2 so make sure you make a copy)
ASSESSMENT:
Answer all questions. Each question in part A and each subquestion in part B is worth the same. For
detailed asses
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
ECO5POE PROBLEM SET NO 2
(due at the beginning of your tutorial in week 3 so make sure you make a copy)
ASSESSMENT:
Answer all questions. Each question in part A and subquestion in part B is worth the same. For detailed
assessment criteria see the subjec
Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology
ACC 338

Winter 2015
Analysis of the stock return of WPL
with the market return
Student ID
183595695
Question 01
Test the null hypothesis that the population mean of your stock return is equal to that of
the market return against an appropriate alternative hypothesis.
Solutio