PPSC Economics Topic 4 Monetary & Fiscal Policy

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PPSC Economics Chapter 4 Important MCQ's

Sr.#	Question	Answer
1	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
2	You move some of your savings account balance into your checking account.	A. M2 falls and M1 rises B. M1 falls and M2 rises C. M1 and M2 are unchanged D. M1 rises and M2 remains unchanged
3	A decrease in autonomous consumer expenditure causes the equilibrium level of aggregate output to __________ at any given interest rate and shifts the ___ curve to the __________	A. rise ; LM ;right B. rise ; IS ; right C. Fall ; LM ; left D. rise ;IS; Left
4	Increasing the government budget deficit.	A. Increases output in the long run B. Decreases output in the short run C. Decreases output in the long run. D. Decreases the interest rate in the medium run.
5	What technical terminology do economists use to refer to how much the money will multiply as this process unfolds.	A. The multiplier B. The money multiplier C. Required reserve ratio D. Open market operations
6	A decline in the money supply shifts the LM curve to the left causing the interest rate to ________ and output to___	A. rise ; rise B. rise ; fall C. fall ; rise D. fall ; fall
7	The purpose of fiscal policy is to	A. Alter the direction of the economy B. Change people's attitudes toward governemnt C. Educate people as to the importance of economics D. Offer insight into the way thing work
8	A shift in tastes toward Pakistan goods ______ net exports and causes the quantity of aggregate output demanded to______	A. decreases ; rise B. decreases ; fall C. Increases ; rise D. Increase ; fall
9	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
10	If the central bank prints more 10 billion and spends them then as a direct result of this action.	A. M1 and M2 both increases B. Neighed M1 nor M2 increase C. M1 increase but M2 does not D. M2 increased but M1 does not.

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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

If the Federal reserve conducts open market __ the money supply __ shifting LM curve to the left.

In the Keynesian cross diagram a decline in autonomous consumer expenditure causes the aggregate demand function to shift down The equilibrium level of aggregate output to ___________ and the IS curve to shift to the

In economics money refers to

If the nominal money supply doubles while real money demand is unchanged what happens to the price level.

A decrease in fully autonomous investment other things equal shifts the ______ curve to the

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.

Which policies are expenditure changing policies.

Factor that cause the IS curve to shift include.

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

An example of discretionary fiscal policy would be.

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

The economic logic behind granting central bank's independence from governmental the conduct of monetary policy is.

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

When a government prints money to finance its expenditures it is likely to cause

Keynes suggested that ________ income households consume a ____ proportion of their income than ____ income households.

The idea that the money supply should change to accommodate changes in aggregate demand is associated with the ideas of.

Which of the following persons would be considered unemployed.

The IS curve shifts to the left when

The quantity of money demanded varies.

If the central bank prints more 10 billion and spends them then as a direct result of this action.

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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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If the Federal reserve conducts open market the money supply shifting LM curve to the left.

Keynes suggested that ____ income households consume a proportion of their income than income households.