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

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PPSC Economics Topic 3 Macro Economics

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Question # 1

The equation for the IS curve is.

Question # 2

The regression results indicate that the standard error of estimate is.

Question # 3

The long run Phillips curve is

Question # 4

What did economist Adam Smith identity as the "invisible hand" that directs the decision making of firms and households in a market economy.

Question # 5

Hyperinflation occurs when

Question # 6

The efficiency wage model can be modified to allow real wages to vary over the business cycle by assuming that.

Question # 7

The costs of disinflation would be low if

Question # 8

If the rate of growth of a full employment labor forc eis 1.55 and 2.55 then the celling rate of growth of real GNP, according to Hick's theory of a constrained business cycle,is.

Question # 9

The appropriate expenditure switching policy to correct a balance of payment surplus is.

Question # 10

Which theory is generally included under micro economics.

Question # 11

The equilibrium level of Y and I derived from the LM and IS equations above is.

Question # 12

The marginal product of labor

Question # 13

If personal income equals Rs.570 white personal income takes equal Rs.90 consumption is Rs.430. interest payments total Rs. 10 and personal saving is Rs. 40, disposable income equals.

Question # 14

In a simple Keynesian world assume the economy is opiating at a full employment noninflationary level worsening world conditions necessitate additional government spending of Rs.50 billion. What should be the direction of change in taxes and magnitude of change to maintain stable price and full employment equilibrium.

Question # 15

Suppose the intersection of the IS and LM curves is to the left of the FE line A decrease in the price level would most likely. eliminate a disequilibrium among the asset labor and goods markets by.

Question # 16

Given the IS equation Y = Ke a - Ke Bn the IS slope decreases when

Question # 17

Which of the following solutions does the economist suggest to cost inflation in higher education.

Question # 18

In the long run an increase in consumer spending would cause output to ________ and the price level to.___________

Question # 19

A change in autonomous spending is represented by.

Question # 20

Banks can create money

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PPSC Economics Chapter 3 Important MCQ's

Sr.# Question Answer
1 Based on the data above , the increase in potential MI would be
A. Rs.50 billion
B. Rs.300 billion
C. Rs.60 billion
D. Rs.100 billion
2 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
3 Assuming that money is neutral an increase in the nominal money supply would causes.
A. An excess supply for goods
B. an increase in the real money supply
C. A fall in the price level
D. A rise in nominal wages
4 In which of the following situations will an increase in the money supply have no effect upon equilibrium iincome.
A. LM is steeply sloped and IS is relatively that
B. LM is vertical and IS is stopped
C. LM is steeply sotped and IS is vertical
D. LM is relatively flat as is IS
5 An economic variable that moves in the opposite direction as aggregate economic activity up in is called.
A. Pro cyclical
B. Countercyclical
C. A cyclical
D. A leading variable
6 The efficiency wage model can be modified to allow real wages to vary over the business cycle by assuming that.
A. Workers effort may depend on the unemployment rate and the real wage
B. During a recession labor supply will decrease reducing the efficiency wage
C. During a recession productivity wil fall causing a reduction in the efficiency wage
D. During a boom labor demand will increase, causing the efficiency wage to rise
7 What adjusts to restore general equilibrium after a shock to the economy.
A. The LM curve
B. The IS curve
C. The FE line
D. The labor supply curve
8 According to Okun's law an increase in the unemployment rate will cause_______ in the level of empolyment and __ in the level of output.
A. An increase ; an increase
B. An increase; a decrease
C. A decrease ; an increase
D. a decrease ; a decrease
9 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
10 A change in autonomous spending is represented by.
A. A movement along a spending line
B. A shift of a spending line
C. A change in a behavioral coefficient.
D. None of these

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