PPSC Economics Topic 11 MCQS Test Preparation

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MCQ's Test For PPSC Economics Topic 11 Assess Your Basics

Try The MCQ's Test For PPSC Economics Topic 11 Assess Your Basics

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PPSC Economics Topic 11 Assess Your Basics

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Question # 1

If I keep some money available in case I see a bargain this is an example of.

Question # 2

The value of an asset depends upon

Question # 3

The abolition of income tax would probably ________ the number of workers in employment and____________ the equilibrium. rate of unemployment.

Question # 4

Monetarists believe that a reduction in _____ can be achieved by reducing.

Question # 5

Under floating exchange rates, expectations of higher interest rates are likely to cause an __________ of the exchange rate.

Question # 6

A competitive equilibrium is Pareto efficient because.

Question # 7

The increase in total cost when one more units is produced is known as.

Question # 8

Normative economics form ______ based on.

Question # 9

When we know the quantity of a product that buyers wish to purchases at each possible price we know.

Question # 10

Short run equilibrium output means that aggregate demand _ actual output

Question # 11

If the income tax rate changes from 30% to 40% on incomes over L 30,000 and a person's income is l 31,000 then her marginal tax rate is.

Question # 12

All of the following are parts of the business cycle except.

Question # 13

In a fixed exchange rate regime, the central bank will intervene by __ pounds to ______ the exchange rate.

Question # 14

Marginal revenue is the ________ when output is.

Question # 15

In the short run, the supply of capital is _______ and in the long run iwll depend on.

Question # 16

Economic transition involves high inflation because ______ and _____

Question # 17

The key issues of macroeconomics are

Question # 18

The business cycle is not transmitted from one country to another through.

Question # 19

If a long average cost rises, output rises from left to right this is an example of.

Question # 20

The retail price index is used to.

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Economics
11th Chapter

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Sr.# Question Answer
1 One of the transmission mechanism of monetary policy is through consumer house hold wealth.___________ and consumption.
A. rise, increases, increases
B. rise, falls, increases
C. rise, increases, falls
D. rise, falls, falls
2 Short run average total costs are equal to the sum of _______ and______
A. Short run opportunity costs, profit
B. Short run average variable costs, profit
C. short run average variable costs, profit.
D. Short run average variable costs short run average fixed costs
3 When investment is assumed to autonomous the slope of the AD schedule is determined by the.
A. Marginal propensity to invest.
B. disposable income
C. Marginal propensity to consume
D. Average properisity to consume
4 A natural monopoly has a declining ________ over a large range of output.
A. Long run marginal cost
B. Short run marginal cost
C. Long run average cost
D. Long run marginal cost
5 The prisoners Dilemma Game demonstrates that.
A. Players are better off to act independently
B. Monopoly is better than competition
C. People will always cheat
D. Players are better off if they con operate
6 A profit maximizing firm will hire labor until _______ equal the
A. Marginal revenue, marginal cost
B. Long run marginal revenue, long run marginal cost
C. Labour output ratio, capital output ratio
D. Marginal cost of labour, marginal revenue product
7 The opportunity cost of a good is.
A. The time lost in finding it
B. The quantity of other goods sacrificed to get another unit of that good
C. The expenditure on the good
D. The loss of interest in using savings
8 A supply curve is directly affected by
A. Technology
B. Input costs
C.
Government regulation
D. All of the above
9 The multiplier accelerator model assumes _______ depends on.
A. Consumption, expected future profits.
B. Investment, interest rates.
C. Investment expected future profits.
D. Stock building, interest rates.
10 When capital mobility is perfect, interest rate differentials will tend to be offset by
A. Price differences.
B. Balance of payments differences.
C. Current account differences.
D. Expected exchange rate changes
11 A fall in investment demand can result from
A. Higher interest rates
B. Lower expected future profits
C. More expensive capital goods
D. All of the above
12 A rise in the real exchange rate will __ the competitiveness of the domestic economy.
A. Increase
B. reduce
C. do nothing do
D. all of these
13 The short run Philips curve can shift in response to changes in
A. inflationary expectations
B. Unemployment
C. The inflation rate
D. Wage rates
14 A fixed exchange rate, plus perfect capital mobility _______ the scope for monetary policy.
A. Enhances
B. Undermines
C. Encourages
D. Facilitates
15 If the diagram of a line shows that lower values on the vertical scale are associated with higher values on the horizontal scale this is an example of.
A. a nonlinear relationship
B. A positive linear relationship
C. A scatter diagram
D. A negative linear relationship
16 Short run equilibrium output means that aggregate demand _ actual output
A. is less than
B. equals
C. is greater than
D. fluctuates around
17 Real business cycle are cycles in
A. Potential output
B. Actual output
C. Real output
D. International trade
18 In an open economy leakages to imports ______ the value of the multiplier.
A. Reduce
B. Increase
C. do not change
D. None of these
19 In the UK in recent years, union membership has ______ and days of work lost because of strikes has.
A. Grown, declined
B. declined, declined
C. declined, grown
D. grown , grown
20 Bank create money by
A. Printing it
B. Issuing debit cards
C. Accepting chequeens
D. Lending out part of their deposits

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