PPSC Economics Topic 4 MCQS Test Preparation

Punjab Public Service Commission, PPSC takes the competitive exam to offer the deserving candidates suitable positions in several governmental organizations. Candidates who are willing to apply for the coming PPSC examination session with the subject of Economics are advised to start their preparation as soon as possible. The reason behind this endorsement is that candidates with exceptional results secure suitable positions and the exceptional result is a result of exceptional preparation.

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

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PPSC Economics Topic 4 Monetary & Fiscal Policy

00:00
Question # 1

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

Question # 2

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

Question # 3

Disposable income is obtained by subtracting ________ taxes from personal income

Question # 4

In the ISLM frame work an expansionary fiscal policy causes aggregate output to _________ and the interest rate to.

Question # 5

Knowledge of the money supply can lead to good predications of nominal GDP only

Question # 6

To move from point E to point E1 is consistent with.

Question # 7

A tax increase __________ disposable income ____ consumption expenditure and shifts the IS curve to the.

Question # 8

According to classical models, the level of employment is determined primarily by

Question # 9

an asset that can easily be exchanged for goods and services is called a.

Question # 10

As the required reserve ratio is decreased the money multiplier.

Question # 11

Total utility of a commodity is measured by which price of that commodity.

Question # 12

If there is a financial panic and increased uncertainty about the return in the stock market and bond market what is the likely effect on money demand.

Question # 13

A monetary expansion is characterized by

Question # 14

The quantity of money demanded varies.

Question # 15

According to Marshall the basis of consumer surplus is.

Question # 16

There are ______ methods of measuring GDP

Question # 17

When the value of the Rupee rises Pakistan goods become _____ expensive relative to foreign goods which ___ exports.

Question # 18

Credit constitutes.

Question # 19

An autonomous decline in the value of the Pakistan Rupee makes Pakistan goods _______ relative to foreign goods and results in a ______ in net exports.

Question # 20

Money or paper currency serves at least _______ functions.

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PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 Money is
A. An indicator of the scarcity of wants
B. Anything that sellers accept i exchange for goods and services.
C. A form of barter
D. Anything that the government classifies as a trade commodity.
2 To move from point E to point E1 is consistent with.
A. Expectations of a constant price level
B. Adaptive expectations that have no adjustment for the period immediately following a change in the actual price
C. Rational expectations and NCM
D. A and B
3 An increases in the quantity of money supplied shifts the money supply curve to the _____and the LM curve to the
A. right ; left
B. right ; right
C. left ; left
D. left ; right
4 If the money supply change was correctly and fully anticipated for a change of M to MI new classical macroeconomics under the assumption of rational expectations would predict a movement from.
A. Pont Eo to point E1
B. Pont Eo to point E2
C. Pont Eo to point E3
D. Pont E3 to point E2
5 According to Marshall the basis of consumer surplus is.
A. Law of diminishing marginal utility.
B. Law of equal marginal utility
C. Law of proportions
D. All of the above
6 Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a ____ shift of the _____ curve.
A. Left ward ; LM
B. Right ; LM
C. Left ward ; IS
D. Left ward ; AD
7 A 15% VAT is a.
A. Proportional income tax
B. Fixed excise duty
C. Ad valorem indirect tax
D. None of the above
8 In economics money refers to
A. Income
B. Wealth
C. Assets use and accepted an payment
D. Currency
9 As the interest sensitivity of investment spending increase.
A. Monetary policy has a larger effect on output
B. Fiscal policy has a larger effect on output
C. The multiplier increases
D. All of the above
10 At any given level of the interest rate expectations are likely to be___________ optimistic and planned investment is likely to be ______ when _________ is growing rapidly than when it is growing slowly or falling.
A. Less ; higher ; output.
B. more ; higher ; output
C. less ; lower ; unplanned investment
D. more ; lower ; unplanned investment

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