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 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.

Question # 2

A change that increases the real money supply relative to real money demand causes.

Question # 3

The aggregate demand curve shows the combinations of output and the price level that put the economy on.

Question # 4

The multiplier which specifically refers to an equal increase in government spending and taxes, giving rise to that same equal increase in national income is called.

Question # 5

Company X sells Rs.75 million dollars of 9.5% first mortgage bonds at par The company's marginal tax rate to 30% The after tax cost of debt is.

Question # 6

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 # 7

The IS curve shows the combinations of output and the real interest rate for which.

Question # 8

The monetary base in composed of.

Question # 9

An increase in total production causes the demand for money to _____ and the interest rate to ______

Question # 10

If the federal reserve whishes to increase the money supply, it should

Question # 11

Changes in subjective or objective factors.

Question # 12

If the foreign interest rate is 12% while the domestic interest rate in 95 then the forward premium will be.

Question # 13

Suppose your company is in equilibrium will its capital stock at its desired level A permanent increase in the depreciation rate now has what effect on your desired capital stock. i

Question # 14

Find the revenue the government collects as a result of the tax

Question # 15

The idea that the natural rate of unemployment rises when the acual rate of unemployment rise is known s.

Question # 16

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

Question # 17

The main cause of cyclical unemployment is that.

Question # 18

Which of the following is not a primary cause of business cycle fluctuations according to real business cycle theory.

Question # 19

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

Question # 20

The risk free rate of interest would not be affected by.

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PPSC Economics Chapter 3 Important MCQ's

Sr.# Question Answer
1 According to the permanent income hypothesis all increases in .
A. Permanent income are saved
B. Permanent income are consumed
C. transitory income are saved
D. Transitory income are consumed
2 An increase in the marginal propensity to import.
A. Has the some effect upon the multipliers as an increase in the MPC
B. Has no effect upon the multipliers
C. Increases the value of the multipliers
D. Decreases the value of the multipllers
3 In the short run in the Keynesian model a sharp increase in oil prices would leave the economy with a ____ level of output and a ______ real interest rate.
A. Higher ; lower
B. Lower ; Higher
C. Higher ; higher
4 By definition, the marginal propensity to consumes.
A. Equals OC/A Yd
B. Is the behavioral coefficient c in the equation C = C + cYd
C. Is the slops of the consumption function.
D. All of the above
5 A temporary decline in productivity 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 right only if people face borrowing constraints
6 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
7 Given the data above, the empirical equation for the IS curve is.
A. Y = 275 + 10 i
B. Y = 225 + 50 i
C. Y = 250 - 10 i
D. Y = 275 - 501
8 What is the average money balance according to the square root rute if income is Rs.1500, each transaction cost is Rs.4, and the opportunity cost of holding money is.2%
A. 387
B. 50
C. 175
D. 203
9 The short run impact of unanticipated expansionary monetary policy is that.
A. Real output decrease
B. Employment decreases
C. Real interest rates decrease
D. Profit margins decrease
10 Which one of the following would cause demand pull inflation.
A. Increases iin production costs
B. Wage gains in proportion productivity gains
C. An increase in aggregate demand with shortages of sup ply
D. Monoposonistic labor markets

Test Questions

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