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

  • Time Allowed20

PPSC Economics Topic 3 Macro Economics

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Question # 1

A decrease in the effective tax rate on capital would cause the IS curve to.

Question # 2

Based on the data above , the increase in potential MI would be

Question # 3

The sign of the simple correlation coefficient is determined by

Question # 4

The estimated regression coefficient for good Y indicates

Question # 5

The impact of contractionary fiscal policy, according to new classical theory is that.

Question # 6

When the economy goes into are cession there's an increase in.

Question # 7

In which of the following situations will an increase in the money supply have no effect upon equilibrium iincome.

Question # 8

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

Question # 9

A temporary decrease in government purchases would cause.

Question # 10

In long run a reduction in labor supply would cause output to __ and the aggregate price level to.

Question # 11

Which of the following macro economics variables is a cyclical.

Question # 12

A group of modern economists who believe that price and wage rigidities do not provide the only rationale for macroeconomic policy activism are called.

Question # 13

The dynamic aggregate demand schedule shifts rightward when there is an increase in.

Question # 14

When the value of output exceeds planned spending .

Question # 15

An economics variable that moves in the same direction as aggregate economic activity is called.

Question # 16

The long term demand for real money balance will rise when

Question # 17

Which of the following macroeconomic variables is procyclical and lags the business cycle.

Question # 18

Ahmed regression model yields a Durbin Watson d statistic whose value is 0.002. The results indicate.

Question # 19

The low point in the business cycle is referred to as the

Question # 20

The long run aggregate supply curve

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PPSC Economics Chapter 3 Important MCQ's

Sr.# Question Answer
1 The regression equation for consumption as a function of disposable income is C = -60 + 0.90Y .the standard error of Y is 30 and the standard error of estimate is 9.5 What is the 95% confidence interval for C when Y is Rs. 1000 billion.
A. Rs.941 to Rs. 979
B. Rs.900 to Rs. 1,020
C. Rs.821 to Rs.859
D. Rs.780 to Rs.900
2 Where there is an equal increase in net tax revenue and government spending, ceteris paribus.
A. (C+I+G) is shifting upward
B. (C+I+G) is shifting downward
C. (C+I+G) does not shift
D. All of these
3 Which of the following is not a primary cause of business cycle fluctuations according to real business cycle theory.
A. A change in the production function
B. A change in the size of the labor force
C. A change in the money supply
D. A change in the real quantity of government purchases
4 Suppose your company is in equilibrium with its capital stock at the desired level A permanent decline in the expected real interest rate now has what effect on your desired capital stock
A. Raises it because the future marginal productivity of capital is higher
B. Lowers it because the future marginal productivity of capital is lower
C. Raises it because the user cost of capital is now lower
D. Lowers it because the user cost of capital is now higher
5 The equation for a givne production function is Q = K2 + KL, initially K = 2 and L = 1 if the value of both inputs is doubted the production function exhibite.
A. Increasing returns to scale
B. Diseconomies of scale
C. Constant returns to scale
D. Economies of scale
6 When a British pound equals Rs. 1.60 and the French France equals Rs. 0.40 the ability to earn infinite profit if it were not the case, implies that the exchange rate would be.
A. 1 franc = 4 pounds
B. 1 franc = 1 pound
C. 5 franc = 1 pound
D. None of the above
7 The normal interest rate minus the inflation rate is the
A. Depreciation rate
B. Discount rate
C. Real interest rate
D. Forward rate
8 Suppose there is full employment and positively sloped aggregate supply schedule A decrees in taxes increases.
A. The price level and real output
B. the prie level but has no effect on real output
C. Real output but has no effect on the price level
D. The nominal and real wage
9 When plotted with the aggregate price level on the vertical axis and output on the horizontal axis which of the following curves is vertical.
A. SRAS
B. AD
C. LRAS
D. None of the above
10 Dynamic multipliers occur when
A. the assumption of ceteris paribus is dropped
B. The economy is not in equilibrium
C. Consumption is unrelated to disposable income
D. there is lagged response between consumption and disposable income

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