PPSC Economics Topic 4 Monetary & Fiscal Policy

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DJ DJ 12 - Aug - 2022 11 Min 02 Sec 11/20
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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	By controlling the monetary base economists mean	A. Controlling the money multiplier B. Restricting the amount of cash in circulation C. Not allowing commercial banks to issue notes and coins D. making banks keep a certain % of their assets as M0
2	As the interest sensitivity of money demand increases	A. The multiplier term increases B. Fiscal policy has a greater effect on output C. Monetary policy has a smaller effect on output D. All of the above
3	Which of the following causes M1 demand to 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
4	A change in the money supply has a greater effect upon equilibrium income.	A. The more interest sensitive private sector spending is. B. The less interest sensitive private sector spending is. C. The smaller the expenditure multiplier is D. The more interest sensitive money holdings are to the rate of interest.
5	If the Bank of Pakistan wished to pursue an expansionary monetary policy it would.	A. Increase the minimum reserve asset ratio B. Sell government securities on the open market C. Buy government securities on the open market D. Raise interest rates.
6	If Federal reserve conducts open market sales, the money supply ___ shifting the LM curve to the_____	A. decreases ; right B. decreases ; left C. Increases ; right D. Increase ; left
7	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
8	A major advantage of monetary over fiscal policy is that monetary policty.	A. Can be put into effect more quickly B. Affects all sectors of the economy equally C. Authorities are quicker to see the need for policy D. Has a more direct and predictable impact on spending.
9	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
10	Which of the following would qualify as an aggregate demand shocks.	A. An unexpected increase in oil prices B. A seasonally expected increase in oil prices C. An unexpected reduction in consumer confidence D. an anticipated tax cut

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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

Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a ____ shift of the _____ curve.

In the money market a condition of excess supply of money cna be eliminated by a _________ in aggregate output or a __ in the interest rate , both of which increase 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 _______

If a perfectly competitive industry is in long run equilibrium all firms will

"Transactions" money is money used as a

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

An increase in autonomous consumer expenditure causes the equilibrium levelof aggregate output to _______ at any given interest rate and shifts the ____ curve to the

Why do people keep currency in their pockets when bank deposits pay interest.

By financial crowding our economists mean

The budget deficit tends to decrease when

The government performs its redistribution function mainly through.

If the Bank of Pakistan wished to pursue a tight monetary policy is would.

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 _______

The IS curve shifts to the left when

Actual equilibrium is Rs. 1,500 billion and full employment is Rs. 2,500 MPC = 0.75 taxes are zero , and prices are adjustable To eliminate the observed deflationary gap , the government should.

The money multiple tells us teh ultimate increase in.

An increase in the quantity of money supplied shifts the money supply curve to the_______ and the equilibrium interest rate

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

When there is no change in central banking holding of international reserve balances a country's

You move some of your savings account balance into your checking account.

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

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Topic Test

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

PPSC Economics Chapter 4 Important MCQ's

Test Questions

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Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a shift of the _ curve.

In the money market a condition of excess supply of money cna be eliminated by a _______ in aggregate output or a in the interest rate , both of which increase 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 _

An increase in autonomous consumer expenditure causes the equilibrium levelof aggregate output to ___ at any given interest rate and shifts the curve to the

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 _____