PPSC Economics Topic 4 Monetary & Fiscal Policy

MCQ's Test For PPSC Economics Topic 4 Monetary & Fiscal Policy

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PPSC Economics Topic 4 Monetary & Fiscal Policy

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Question # 1

The parable of Riding a Switchback suggests that stabilizing policy.

Is not sufficiently stimulating or contra citing the economy at any time A
Is desirable B
Is effective C
Is stimulating or contracting the economy at the wrong times. D

Question # 2

The IMF is an agency charged with providing.

Technical assistance to stock market and financial market problems. A
Loans for post World War II reconstruction B
Short term credit for international balance of payments deficits C
Bonds denominated in U.S. dollars as a loan to LDCs D

Question # 3

When a nations money supply is Rs.1200 billion and the nominal Gros National product is Rs.4800 billion the velocity of money is.

0.25 A
4 B
0.4 C
Rs.4 billion D

Question # 4

Fiscal policy refers to the manipulation of government income and expenditure to.

control the volume and price of money A
Limit the rate of increaes in incomes B
Effect the value of the dollar on world financial market. C
Affect the level of total expenditure output and employment D

Question # 5

Money's primary role in the economy comes from the benefits of lowering transactions costs and allowing specialization This function of money is called.

Store of value A
Medium of exchange B
Standard of deferred payment C
Unit of account D

Question # 6

The aggregate demand curve is downward sloping because a higher price level.

Makes people wealthier and so they spend more A
Causes higher wages and so people spend more B
Cuts the real value of income and so people spend less C
Decreases the real supply of money decreasing spending. D

Question # 7

Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a shift of the _ curve.

Left ward ; LM A
Right ; LM B
Left ward ; IS C
Left ward ; AD D

Question # 8

The IS curve shifts to the left when

Taxes increase A
Government spending increase B
The money supply increases C
All of the above occur D

Question # 9

When your grandmother keeps her savings hidden under her mattress she is using money as.

a standard of deferred panyment A
A comfortable thing for sleeping B
A medium of exchange C
A store of value D

Question # 10

The largest source of tax revenue for the federal government is.

The personal income tax A
The social security tax B
The property tax C
The sales tax D

Question # 11

in the Keynesian cross diagram, a decrease in investment spending because companies become more pessimistic about investment profitability causes the aggregate demand function to shift _the equilibrium level of aggregate output to __l and the IS curve Curve to shift to the.

rise ; left A
rise ; right B
fall ; left C
fall ; right D

Question # 12

Fiscal policy refers to.

The actions of the central bank in controlling the money supply A
The government's altitude to taxation B
The spending and taxing policies used by the government to influence the economy C
The governments regulation of financial intermediaries. D

Question # 13

An autonomous rise in __ note causes by a change in the price level aggregate output of the interest shifts the _ curve to the

Net exports LM right A
Net exports LM left B
Money demand IS right C
Money demand LM left D

Question # 14

A decline in taxes __ consumer expenditure and shifts the _ curve shifts to the.

Raises ; LM; Right A
Lowers; IS ; left B
raises ; IS; right C
Lower ; LM; left D

Question # 15

An increases in the quantity of money supplied shifts the money supply curve to the _____and the LM curve to the

right ; left A
right ; right B
left ; left C
left ; right D

Question # 16

A monetary expansion is characterized by

Rising output and interest rates A
Rising output and falling interest rates. B
Constant output and falling interest rates C
Falling output and interest rates D

Question # 17

A major advantage of monetary over fiscal policy is that monetary policy

Can be put into effect more quickly A
Affects all sectors of the economy equally B
Authorities are quicker to see the need for policy C
Has a more direct and predictable impact on spending. D

Question # 18

How much of the Rs.5 billion dollar increase in government expenditures will be recouped in taxes.

Rs.1 billion A
Rs.2 billion B
Rs.0.9 billion C
Rs.0.5 billion D

Question # 19

Which of the following part of M1

Stock negotiating accounts A
Automatic transfer system accounts B
Negotiable orders of withdrawal accounts C
Demand deposits of mutual saving banks. D

Question # 20

If the nominal money supply doubles while real money demand is unchanged what happens to the price level.

The price level increases by a factor of four A
The price level doubles B
The price level is unchanged C
The price level falls by one half. D

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PPSC Economics Topic 4 MCQS Test Preparation

MCQ's Test For PPSC Economics Topic 4 Monetary & Fiscal Policy

PPSC Economics Topic 4 Monetary & Fiscal Policy

The parable of Riding a Switchback suggests that stabilizing policy.

The IMF is an agency charged with providing.

When a nations money supply is Rs.1200 billion and the nominal Gros National product is Rs.4800 billion the velocity of money is.

Fiscal policy refers to the manipulation of government income and expenditure to.

Money's primary role in the economy comes from the benefits of lowering transactions costs and allowing specialization This function of money is called.

The aggregate demand curve is downward sloping because a higher price level.

Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a ____ shift of the _____ curve.

The IS curve shifts to the left when

When your grandmother keeps her savings hidden under her mattress she is using money as.

The largest source of tax revenue for the federal government is.

in the Keynesian cross diagram, a decrease in investment spending because companies become more pessimistic about investment profitability causes the aggregate demand function to shift _____the equilibrium level of aggregate output to ______l and the IS curve Curve to shift to the.

Fiscal policy refers to.

An autonomous rise in __________ note causes by a change in the price level aggregate output of the interest shifts the _________ curve to the

A decline in taxes __ consumer expenditure and shifts the _ curve shifts to the.

An increases in the quantity of money supplied shifts the money supply curve to the _____and the LM curve to the

A monetary expansion is characterized by

A major advantage of monetary over fiscal policy is that monetary policy

How much of the Rs.5 billion dollar increase in government expenditures will be recouped in taxes.

Which of the following part of M1

If the nominal money supply doubles while real money demand is unchanged what happens to the price level.

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Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a shift of the _ curve.

in the Keynesian cross diagram, a decrease in investment spending because companies become more pessimistic about investment profitability causes the aggregate demand function to shift _the equilibrium level of aggregate output to __l and the IS curve Curve to shift to the.

An autonomous rise in __ note causes by a change in the price level aggregate output of the interest shifts the _ curve to the