PPSC Economics Topic 4 Monetary & Fiscal Policy

Top Scorers Of PPSC Economics Topic 4 Monetary & Fiscal Policy MCQ`s Test

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zaheer hussain 18 - Jan - 2024 14 Min 06 Sec 11/20
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Mahnoor NaSir 24 - May - 2022 07 Min 27 Sec 9/20

PPSC Economics Chapter 4 Important MCQ's

Sr.#	Question	Answer
1	Consider the five panels of the figure on the previous page in which panel would fiscal policy be the strongest.	A. Panel b B. Panel c C. Panel a D. Panel d
2	Money or paper currency serves at least _______ functions.	A. Three B. Four C. Five D. Seven
3	The market price of bonds can fluctuate depending on	A. How many bonds were sold B. Who bought the bonds C. The amount of the coupon D. The interest rate
4	If the Federal reserve conducts open market ________ the money supply _______ shifting the LM curve to the right.	A. Purchases ; decreases B. sales ; increases C. purchases ; increases D. sales ; decreases
5	Which of the following causes M1 demand is decrease.	A. A fall in the tax rate B. An increase in income C. A fall in the interest rate D. An increase in the use of credit cards
6	According to classical models, the level of employment is determined primarily by	A. The level of aggregate demand for goods and services B. Prices and wages C. Government taxation D. Government spending
7	"Although he didn't say so, this may ultimately compet the central bank to resort increasingly to managing the money supply by managing banks excess cash reserves the stuff from which the banks create loans". How would the central bank manages these excess reserves.	A. By buying bonds B. By selling bonds C. By changing reserve requirements D. All of the above
8	Those who favor setting the target rate of inflation at about 3% believe.	A. The cost of moderate inflation can be minimized by indexing the tax system and bonds B. that the cost of going to 0% is very low C. That moderate inflation increases money illusion D. Believe that moderate inflation aggravates the time inconsistency problem
9	A checking deposit held at a commercial bank is considered ______ of that bank.	A. An asset B. Net worth C. a liability D. Capital
10	How much of the Rs. 5 billion dollar increase in the government expenditures will be financed by bond sales.	A. Rs.3.5 billion B. Rs.1.5 billion C. Rs. 4.9 billion D. Rs.2.8 billion

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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

A shift in tastes loward foreign goods______ net exports and causes the quantity of aggregate output demanded to.

The near term effect of an unexpected sale of bonds by the central bank is.

Under a fixed exchange rate system an expansionary fiscal policy leads to a

An example of discretionary fiscal policy would be.

" A growing number of economists view the Fed's new willingness to take on more of the nation's debt as inflationary in the long run." This inflation worry is because.

The main role of the Federal Reserve is to

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

Following the work of _____________ in the 1960s, and the controversy associated with these views in the 1970s, there was a revival of interest by economists and government in monetary policy.

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

The limit of an economy's total productive capacity at any given time is set by

When the central Bank ________ the money supply the LM curve shifts to the _______ interest rates ____________ and equilibrium aggregate output.

Under system fixed exchange rates which of the following policies promotes internal balance for a nation.

The function of money do not include.

Monetary policy is concerned with influencing.

Which of the following part of M1

Why would corporations want to achieve zero balances in their checking accounts.

The investment demand curve shows the relationship between the levels of.

Other things equal a decrease in autonomous consumption shifts the _____ curve to the

"Although he didn't say so, this may ultimately compet the central bank to resort increasingly to managing the money supply by managing banks excess cash reserves the stuff from which the banks create loans". How would the central bank manages these excess reserves.

In the Keynesian cross diagram an increasing investment spending because companies become more optimistic about investment profitability causes the aggregate demand function to shift ______ and the equilibrium level of aggregate output to rise and the IS curve to shift to the

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Top Scorers Of PPSC Economics Topic 4 Monetary & Fiscal Policy MCQ`s Test

PPSC Economics Chapter 4 Important MCQ's

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When the central Bank ____ the money supply the LM curve shifts to the _ interest rates __________ and equilibrium aggregate output.