PPSC Economics Topic 4 Monetary & Fiscal Policy

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PPSC Economics Chapter 4 Important MCQ's

Sr.#	Question	Answer
1	A decrease iin money demand other thing equal shifts the _____ curve to the	A. IS ; right B. Is ; Left C. LM ; Left D. LM ; Rfight
2	What major advantage of monetary policy over fiscal policy does this clipping underline.	A. Monetary policy is more effective B. Monetary policy is lss discriminatory C. Monetary policy can influence interest rates D. Monetary policy can be undertaken more quickly
3	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
4	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
5	A good that is used as a medium of exchange as well as being a consumption good is called.	A. A barter money B. A commodity money C. A legal tender D. A debased money
6	In the Keynesian cross diagram, an increase in autonomous consumer function to shift _______ the equilibrium level of aggregate output to rise and the IS curve to shift to the.	A. up ; left B. up ; right C. down ; left D. down ; right
7	An autonomous rise in the value of the Rupee makes Pakistan goods _____ expensive relative to foresight goods which ______ net exports	A. Less ; decreases B. Less ; increases C. More ; decreases D. more ; increases
8	A Political problem with discretionary fiscal policy is the.	A. Contractionary bias B. Big state bias C. Expansionary bias D. Over reaction bias
9	An increases in the value of the Rupee makes foreign goods cheaper relative to Pakistan goods, resulting in a _______ in net exports and a __ shift of the IS curve	A. fall ; leftward B. rise ; leftward C. fall ; rightward D. rise ; rightward
10	In the ISLM framework an expansionary monetary policy causes aggregate output to _____________ and the interest rate to	A. increase ; increase B. Increase ; decrease C. decrease ; decrease D. decrease ; increase

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

PPSC Economics Topic 4 Monetary & Fiscal Policy

In the Keynesian cross diagram, a decline in autonomous consumer expenditure causes the aggregate demand function to shift ______ and the equilibrium level of aggregate output to.

Which of the following is not an important variable in growth accounting calculations.

Which of the followig does not shift the IS curve .

How much of the Rs. 5 billion dollar increase in the government expenditures will be financed by bond sales.

A rise in planned investment spending unrelated to the interest rate causes teh equilibrium level of aggregate output to __________ at shifts the _____ curve to the _______

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

A bonds becomes a riskier asset the demand for money_______ and all else constant, the equilibrium interest rate

An increase in money _______ shifts the LM curve to the _____ causing the interest rate to fall and output to rise

The increase in base money divided by the corresponding induced increasing commercial bank deposits is the.

A decline in the value of the rupee makes Pakistan goods cheaper relative to foreign goods, resulting in a _________ in net exports and a ________shifts of the IS curve.

The opportunity cost of holding currency decrease when

A sale of bonds by the central bank should cause.

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.

"A monetary rule need not mean a single baid number If the central bank fears velocity shifts rules could be adopted for adjusting the target in the face of a trends change in velocity "If velocity were trending upward the target money growth rate would be adjusted.

Which of the following measures is the best measure of money as a medium of exchange.

If the Bank of Pakistan wished to pursue an expansionary monetary policy it would.

If the central Bank wished to Tighten money is would.

A bank has excess liquidity reserves to lend but is unable to find a willing borrower these will_______ the size of the money multiplier.

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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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A rise in planned investment spending unrelated to the interest rate causes teh equilibrium level of aggregate output to ________ at shifts the _ curve to the _____

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

An increase in money ___ shifts the LM curve to the _ causing the interest rate to fall and output to rise

A decline in the value of the rupee makes Pakistan goods cheaper relative to foreign goods, resulting in a _ in net exports and a shifts of the IS curve.