PPSC Economics Topic 4 Monetary & Fiscal Policy

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PPSC Economics Chapter 4 Important MCQ's

Sr.#	Question	Answer
1	In the ISLM frame work an expansionary fiscal policy causes aggregate output to _________ and the interest rate to.	A. increases ; increase B. increases ; decrease C. decreases ; decreases D. decreases ; increses
2	a contractionary monetary policy	A. Reduces interest rtes B. Reduces real output C. shifts the LM curve to the right D. All of the above
3	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	A. up ; right B. up ; left C. down ;left D. down ; right
4	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
5	When a nations money supply is Rs.1200 billion and the nominal Gros National product is Rs.4800 billion the velocity of money is.	A. 0.25 B. 4 C. 0.4 D. Rs.4 billion
6	Disposable income is obtained by subtracting ________ taxes from personal income	A. Indirect taxes B. Direct taxes C. Subsidies D. None
7	Which school of economic thought suggested that one possible cause of inflation was a push from the cost side.	A. New classical economists B. Monetarists C. Marxists D. Keynesians
8	An autonomous increase in money demand.	A. Shift the IS curve to the right B. Shifts the IS curve to the left C. Shift the LM curve to the right D. Shift the LM curve to the left
9	There are _______ major instrument of monetary policy.	A. Three B. Four C. Five D. None
10	If the original money supply is MSo and the original demand for money is MDo then	A. The equilibrium interest rate and savings are 5% and 50 B. The money supply is 200 and equilibrium income is 500 C. The equilibrium interest rate and income are 5% and 600 D. The speculative demand is 25

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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

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

What major advantage of monetary policy over fiscal policy does this clipping underline.

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

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

The money multiple tells us teh ultimate increase in.

A decrease iin money demand other thing equal shifts the _____ curve to the

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.

Suppose a new law imposes a tax on all trades of bonds and stock What is the likely effect on money demand.

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.

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

Which of the following would qualify as an aggregate demand shocks.

An autonomous increase in money demand.

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 _______

A decrease iin money demand other thing equal shifts the _____ curve to the

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

Increasing the government budget deficit.

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

using money as a medium of exchange.

Automatic stabilizers

When the reserve requirement on checking deposits is 0.10 and the Federal Reserve purchases government securities values at Rs. 100,000, the MI money supply.

Prepare Complete Set Wise PPSC Economics Topic 4 Monetary & Fiscal Policy MCQs Online With Answers

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Set 11

Set 12

Set 13

Set 14

Topic Test

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

PPSC Economics Chapter 4 Important MCQ's

Test Questions

Share your comments & questions here

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.

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 _

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