Department of Economics, Government College University Faisalabad

Mid Exam: Islamic Economics Course Code: ECO-651

Class & Semester: M.Sc 3rd Semester Time: 1 hour
Note: All questions are compulsory and carrying equal marks. (7+7+7)
1. Justify that how Revolution approach is the most appropriate to rebuild Islamic system?
2. Logically, linguistically, and religiously justify that why did Islam proscribe interest?
3. How does home financing Musharaka work? Also explain that in what sense is
Musharaka an asset-based or equity-based source of finance?
Objective:
4. Encircle the appropriate option. (5+4) 9
a. secularism emerged as Aristocrats were defeated by Monarchs. T F
b. The main objective of Islamic banks is to make attractive returns for the shareholders. T F
c. Applying Islamic finance principles results in interest (riba) being prohibited. T F
d. The Mudarib is the investor in Mudaraba mode of financing. T F
e. Under an Ijara wa Iqtina contract, insurance is usually paid by the lessee. T F
f. Make the difference between Salam and Istasna’a
Department of Economics, Government College University Faisalabad
Final Exam: Intermediate Microeconomics Course Code: ECO-401
Class & Semester: BS 3 Semester
rd
Time: 2 hour
Note: All questions are compulsory
Subjective Part
1. Graphically and theoretically present that how does government price control policy impact on
consumer and producer surplus? 7
2. Q#5 Lets assume a Cobb-Douglas production function q=kαlβ where α+β=1 and TC=wl+vk where w
(wage)=12 and v(rent for capital)=3 for a competitive firm. Now graphically and mathematically
show and calculate the level of k and l where total cost is minimum to produce q=40. 7
3. Separate out substitution and income effects from total effect of price increase and also derive
Hicksian and Marshallian demand curves from above case? 7

4. Objective Part 9

1. Explain the difference between a) substitute and complements 2+2

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b) Perfect competition and monopoly
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2. Encircle the appropriate option. 5
a. The points of SMC below the SAVC curve represent the price taking firms’ short run supply curve. T F
b. A profit maximizing monopolist produces that q for which MC=MR T F
c. Under perfect monopoly, the monopoly charges two different prices in two different markets. T F
d. A production is called increasing return to scale if inputs and output increase with same proportion. T F
e. In case of elastic demand curve, the MR will be negative. T F