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

One of money's primary roles in the economy comes from the use of money to transfer purchasing power to the future This role of money is called.

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

Question # 2

An increase in the money supply other thighs equal shifts the ______ curve to the

IS ; right A
Is ; left B
LM ; Left C
LM ; right D

Question # 3

The intersection of the IS and LM curves captures.

The equilibrium of the demand and supply sides of the economy A
the equivalence of monetary and fiscal policy B
Joint equilibrium in the goods and money markets C
All of the above D

Question # 4

Net taxes are.

Government expenditures minus government revenues. A
Taxes paid by firms and households to the government minus the transfer payments made to firms and household. B
Taxes paid by firms and household to the government plus transfer payments made to firms and hose holds. C
Taxes paid by firms and hose hold to the government minus the cost of collecting the taxes. D

Question # 5

The automatic stabilization function of fiscial policy ensures that government expenditures _______ and government revenues during recessions.

decrease ; decrease A
decrease ; increase B
Increase ; decrease C
increase ; increase D

Question # 6

Which of the followig does not shift the IS curve .

An increases in autonomous consumption A
An increase in government spending. B
A decline in government spending C
A fall in theinterest rate D

Question # 7

Fiscal policy is purposeful movements in _____designed to direct an economy

Interest rate A
Legal structures B
Government regulations C
D Government spending and taxes D

Question # 8

A shift in tastes toward Pakistan goods ________ net exports and causes the IS curve to shift to the.

decreases ; right A
decreases ; fall B
increases ; rise C
increases ; fall D

Question # 9

A shift in tastes toward foreign goods ______ net exports and causes the IS curve to shift to the

decreases ; right A
decrease ; left B
increase ; right C
increases ; left D

Question # 10

The quantity of money demanded varies

Directly with both prices and output A
Inversely with both prices and output B
Directly with prices and inversely with output C
Inversely with prices and directly with output D

Question # 11

In the Keynesian corss diagra, an increase in autonomous consumer expenditure causes the aggregate demand function to shift up the equilibrium level of aggregate output to _ and the IS curve to shift to the _

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

Question # 12

In the money market a condition of excess demand for money can be eliminated by a ______ in aggregate output or a in the interest rate both of which reduce the quantity of money demanded.

rise ; rise A
rise; fall B
fall ; rise C
fall ; fall D

Question # 13

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.

Less ; higher ; output. A
more ; higher ; output B
less ; lower ; unplanned investment C
more ; lower ; unplanned investment D

Question # 14

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 # 15

" 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 government may tax less A
The debt may become excessive B
The government may spend more C
The money supply may increase excessively D

Question # 16

An increase in expected inflation is likely ot cause.

A decline in the demand for real balances A
an increase in the demand for real balances. B
No change i the demand for real balances C
No change in the demand for real balances only of the income elasticity of real money demand is zero. D

Question # 17

According to the Laffer curve as tax rates increase tax revenues.

Decrease continuously. A
Initially decrease and then increase B
Rise continuously C
Initially increase and then decrease D

Question # 18

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 # 19

A tax cut disposable income ___ consumption expenditure and shifts the IS curve to the.

Increases ; increases ; right A
Increases ; decreases ; left B
decreases ; increases ; left C
decreases ; decreases ; right D

Question # 20

Monetary policy is concerned with influencing.

The general level of money wages A
The level of government expenditure B
The price and availability of money C
The level of shares on the stock market 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

One of money's primary roles in the economy comes from the use of money to transfer purchasing power to the future This role of money is called.

An increase in the money supply other thighs equal shifts the ______ curve to the

The intersection of the IS and LM curves captures.

Net taxes are.

The automatic stabilization function of fiscial policy ensures that government expenditures _________ and government revenues __ during recessions.

Which of the followig does not shift the IS curve .

Fiscal policy is purposeful movements in _____designed to direct an economy

A shift in tastes toward Pakistan goods ________ net exports and causes the IS curve to shift to the.

A shift in tastes toward foreign goods ______ net exports and causes the IS curve to shift to the

The quantity of money demanded varies

In the Keynesian corss diagra, an increase in autonomous consumer expenditure causes the aggregate demand function to shift up the equilibrium level of aggregate output to _______ and the IS curve to shift to the _______

In the money market a condition of excess demand for money can be eliminated by a __________ in aggregate output or a ____ in the interest rate both of which reduce the quantity of money demanded.

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.

The IMF is an agency charged with providing.

" 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.

An increase in expected inflation is likely ot cause.

According to the Laffer curve as tax rates increase tax revenues.

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

A tax cut __ disposable income _____ consumption expenditure and shifts the IS curve to the.

Monetary policy is concerned with influencing.

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The automatic stabilization function of fiscial policy ensures that government expenditures _______ and government revenues during recessions.

In the Keynesian corss diagra, an increase in autonomous consumer expenditure causes the aggregate demand function to shift up the equilibrium level of aggregate output to _ and the IS curve to shift to the _

In the money market a condition of excess demand for money can be eliminated by a ______ in aggregate output or a in the interest rate both of which reduce the quantity of money demanded.

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 tax cut disposable income ___ consumption expenditure and shifts the IS curve to the.