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

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

Question # 2

If the economy is in equilibrium at Rs. 180 billion and taxes are reduced by Rs.20 billion, find the new equilibrium given that this is a simple economy i.e. exogenous government spending tax collection and investment spending and a marginal propensity to consume of . .75

Question # 3

Where there is an equal increase in net tax revenue and government spending, ceteris paribus.

Question # 4

The three main components of the aggregate demand aggregate supply model include.

Question # 5

Firms hire labor at the point where the

Question # 6

In the monetary base is increased by $1,000 and the reserve requirement is 10% by how much will the money supply be increased.

Question # 7

A temporary decline in productivity would cause the IS curve to.

Question # 8

The econometric problem of errors in variables leads to

Question # 9

If the price level for an economy was 100 in 1984 , 115 in 1985 and 125 in 1986 the rate of inflation between 1985 and 1986 was.

Question # 10

In the expenditure approach to GDP which of the following would be excluded from measurement of GDP.

Question # 11

An efficient economy is an economy

Question # 12

When planned saving is greater than planned investment.

Question # 13

The main cause of cyclical unemployment is that.

Question # 14

"Economics is what economists do " It has been supported by.

Question # 15

All of the following are obstacles to international economic policy coordination except.

Question # 16

Which of the following is a NOT component of M-2.

Question # 17

A Rs.10 increase in autonomous investment spending shifts IS

Question # 18

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 # 19

When an increase in government spending is matched by an equal decrease in government transfers, the income level will.

Question # 20

An increase in the real wage rate will cause.

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PPSC Economics Chapter 3 Important MCQ's

Sr.# Question Answer
1 Which market adjusts the quickest in response to shocks to the economy.
A. The asset market
B. The labor market
C. The goods market
D. In the macro economy
2 In which of the following situations will an increase in the money supply have no effect upon equilibrium income.
A. LM is steeply sloped and IS is relatively flat
B. LM is vertical and IS si steeply sloped
C. LM is steeply sloped and IS is vertical
D. LM is relatively flat as is IS
3 A decrease in wealth would cause the IS curve to
A. Shift up and to the right
B. Shift down and to the left
C. Remain unchanged
D. Shift up and to the right only in poeple face borrowing constraints.
4 A nation experience external balance if it achieves.
A. No net changes in its international gold stocks
B. Productivity levels equal to those of its trading partners
C. An increases in its money supply equal to increases overseas
D. Equilibrium in its balance of payments
5 According to Keynesians the primary source of business cycle fluctuation is.
A. Aggregate demand shocks
B. Productivity shocks
C. Oil price shocks
D. Consumer confidence shocks
6 The equilibrium level of Y and I derived from the LM and IS equations above is.
A. Y = 130 and I = 10%
B. Y = 200 and I = 30%
C. Y = 180 and I = 7%
D. Y = 250 and I = 2%
7 If the federal reserve whishes to increase the money supply, it should
A. Raise the reserve requirement
B. Raise the discount rate
C. Buy Treasury securities in the open the market
D. All of the above
8 Find the change in revenue to the industry due to the taxs.
A. Rs. 40 billion
B. Rs. 34 million
C. Rs.25 million
D. Rs.36 Million.
9 In closed economic model aggregate demand is not sensitive to.
A. Interest rates
B. Exchange rates
C. Price level
D. Tax policy
10 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

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