Saturday, 6 April 2019

STATE BANK OF PAKISTAN BANKING SERVICES CORPORATION OFFICERS (OG-1) 8TH BATCH SAMPLE PAPER


Answers of all questions are at Page 4


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STATE BANK OF PAKISTAN



BANKING SERVICES CORPORATION

OFFICERS (OG-1) 8TH BATCH



SAMPLE PAPER



SECTION 1 - ENGLISH



SECTION 1 - ENGLISH


Read the following passage carefully and answer questions 1 and 2.

The relevance of formal economic models to real-world policy has been a topic of some dispute. The economist R.D. Norton and S.Y. Rhee achieved some success in applying such a model retrospectively to the Korean economy over a fourteen-year period. The model’s figures for output, prices and other variables closely matched real statistics. The model’s value in policy terms, however, proved less clear-cut. Norton and Rhee performed simulations in which, keeping long term factors constant, they tried to pinpoint the effect of short-term policy changes. Their model indicated that rising prices for imported oil would increase inflation, reducing exports by 5 percent would lower Gross Domestic Product and increase inflation and slowing the growth of money supply would result in slightly higher inflation.


These findings are somewhat startling. Many economists have argued that reducing exports will lessen, not increase, inflation. And while most view escalating oil costs as inflationary, few would think the same of slower monetary growth. The Norton-Rhee model can perhaps be viewed as indicating the pitfalls of a formalist approach that stresses statistical “goodness of fit” at the expense of genuine policy relevance.

Q1.   In the passage, the author is primarily concerned with:

A.    Suggesting an explanation for Korean inflation.

B.     Criticizing an overly formal economic model.

C.     Advocating the use of statistical models in determining economic policy.

D.    Proposing a new type of economic analysis.

Q2.   The author mentions a “fourteen-year” period in order to:

A.    Indicate how far into the future the model can make accurate forecasts.

B.     Acknowledge the accuracy of Norton and Rhee’s model in account of past events.

C.     Explain the effects of reducing exports on inflation.

D.    Expose the flaws in Norton and Rhee’s model.

Select the correct SYNONYM (similar meaning) for the word from the given options.

Q3. SAGE

A.    Wise

B.     Inattentive

C.     Hasty

D.    Negligent









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