PPSC Economics Topic 3 MCQS Test Preparation

Are you getting prepared for the PPSC economics test to appear for the upcoming positions? Well, you are offered the best wishes for your attempt. However, at the same time, the team of Ilmkidunya invites all the candidates to get a better solution for PPSC examination preparation. Students can find sample PPSC online tests. These tests will make the students able to know the exact paper pattern and also help them to sort out the important questions according to examination. Here on this page, the test of Topic 3, Macroeconomics is offered. However, students can also attempt the tests of other Topic through separate sections and pages.

MCQ's Test For PPSC Economics Topic 3 Macro Economics

Try The MCQ's Test For PPSC Economics Topic 3 Macro Economics

  • Total Questions20

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PPSC Economics Topic 3 Macro Economics

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Question # 1

If government spending of Rs. 10 and a lump sum tax of Rs.10 is added, the empirical equation for the new IS curve becomes.

Question # 2

The yield curve shows

Question # 3

In the product market of the circular flow model.

Question # 4

When total utility becomes maximum then marginal utility will be.

Question # 5

The MPS = 0.4 and government spending increases by 20 billion. The LM curve

Question # 6

An increase in the number of workers hired by a firm could result from

Question # 7

If the reserve deposit ratio is 0.25 and the ratio of currency in circulation to deposits is 0.3, the potential money multiplier will have a value of.

Question # 8

The break even level of income where C = Y is

Question # 9

A Rs.10 increase in autonomous investment spending shifts IS

Question # 10

Fiscal policy output to change demand for output is.

Question # 11

The equilibrium level of employment achieved after the complete adjustment of wages and prices, is known as the.

Question # 12

According to the permanent income hypothesis all increases in .

Question # 13

In the Keynesian model in the short run a decrease in government purchases causes output to _____ and the real interest rate to.

Question # 14

Total factor productivity growth is that part of economic growth due to.

Question # 15

Dynamic multipliers occur when

Question # 16

The major source of revenue for the government is.

Question # 17

Money must fulfill all of the following functions except.

Question # 18

Monetary expansion can still be effective in getting out of liquidity trap if it's combined with.

Question # 19

Which policy is an expenditure switching policy.

Question # 20

The valued of expenditure multiplier relates.

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PPSC Economics Chapter 3 Important MCQ's

Sr.# Question Answer
1 In the Keynesian model which curve is vertical.
A. LRAS
B. SRAS
C. AD
D. NS
2 Most industrial construes generally considered _______ as the most important economic goal
A. External balance
B. Internal balance
C. Maximum efficiency for business
D. Maximum efficiency for labor
3 The long run foreign exchange rate between the U.S. and Japan is 200 Yen =Rs. 1 under a floating exchange rate Which of the following does 112 t occur if the Federal Reserve reduce the money supply in order to prevent the occurrence of inflation.
A. Foreign capital flows to the U.S.
B. The U.S. dollar appreciates
C. Real net exports decline
D. American real GNP experience a slower rate of growth
4 A situation in which expansionary in monetary policy has no effect on the economy is known as.
A. Macro economic stabilization
B. A liquidity trap
C. A depression
D. Capital flight
5 When the economy goes into are cession there's an increase in.
A. Frictional unemployment
B. structural unemployment
C. Cyclical unemployment
D. Voluntary unemployment
6 Total factor productivity growth is that part of economic growth due to.
A. Capital growth plus labor growth
B. Capital growth less labor growth
C. Capital growth times labor growth
D. Neither capital growth nor labor growth
7 O kun's Law states that for each percentage point by which the unemployment rate is above the natural rate real GNP is 3% below potential GNP, if real GNP is Rs. 3,800 billion with the actual level of unemployment at 6.05 and the natural rate of unemployment at 4.5% then according to Okun's law the GNP gap is.
A. 171 billion
B. 684 billion
C. 114 billion
D. 228 billion
8 Fractional unemployment arises when
A. Unskilled or low skilled workers find it difficult to obtain desirable long term jobs
B. Labor must be reallocated from industries that are shrinking to areas that are growing.
C. Workers must search for suitable jobs and firms must search for suitable workers.
D. Output and employment are below full employment levels
9 The nominal interest rate minus the inflation rate is the
A. Depreciation rate
B. Discount rate
C. Forward rate
D. Real interest rate
10 An economics variable that moves in the same direction as aggregate economic activity is called.
A. Countercyclical
B. Procyclical
C. A cyclical
D. A leading variable

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