PPSC Economics Topic 4 Monetary & Fiscal Policy

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

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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	Over time the wealth of society increases and payments technologies get more efficient What is the effect on money demand of these two changes.	A. Money demand rises proportionately to the rise in wealth. B. Money demand rises, but less than proportionately to the rise in wealth. C. The overall effect in ambiguous D. Money demand declines
2	Which of the following persons would be considered unemployed.	A. a house wife B. A person who worked more than 20 hours in a family owned business C. A 15 years old looking for summer employment D. A recent college graduate looking for her fist job
3	The situation in which the imports are greater than exports is termed as.	A. Trade surplus B. Trade deficit C. Budget surplus D. None
4	A decrease in the legal reserve ratio from 25% to 20% will	A. Result in light money B. Be contractionary C. Increases excess reserves and the potential money multiplier D. Decrease excess reserves and the potential money multiplier
5	A monetary action consistent with the central bank selling bonds in the open market would be.	A. An increase in the reserve ratio B. A reduction in the discount rate of interest C. An increase in government spending. D. a reduction in excise taxes
6	An increase in spending those results from expansionary _______ policy cause the interest rate to.	A. fiscal ; rise B. fiscal ; fall C. incomes ; rise D. income ; fall
7	"The earlier predictions underestimated currency in circulation and treasury balances at the Fed, both of which drained reserves from the banking system" Lower reserves means.	A. Lower interest rates B. Lower money supply C. Lower unemployment D. Higher inflation
8	The purpose of financial intermediaries is.	A. To allow more saving than investment B. To discourage consumption spending C. To collect income taxes for the government D. To serve are middlemen between savers and borrowers.
9	What is the significance of underestimating transactions money.	A. Monetary policy will be over simulating the economy B. Monetary policy will be putting a drag on the economy C. there is a need for money that the central bank should be meating. D. The economy has too much money and there frore not enough spending.
10	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.	A. Increase G by Rs.1,000 B. Decrease G by Rs.250 C. Increase G by less than Rs.100 D. Decrease G by more than Rs.250 but less than Rs.1000

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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

When a nations money supply is Rs.1200 billion and the nominal Gros National product is Rs.4800 billion the velocity of money is.

Fiscal policy is purposeful movements in _____designed to direct an economy

The ratio of debt to GDP will be larger

A 15% VAT is a.

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

An expansionary monetary policy

Aggregate output and the interest rate are ______ related to government spending and are ___ related to taxes.

By controlling the monetary base economists mean

A monetary expansion is characterized by

A good that is used as a medium of exchange as well as being a consumption good is called.

As the interest sensitivity of investment spending increase.

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

There are _______ major instrument of monetary policy.

If the original money supply is MSo and the original demand for money is MDo then

A decrease in the legal reserve ratio from 25% to 20% will

The quantity of money demanded varies

Weighted monetary aggregates

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

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.

The central bank and the government are working against each other if as the government cuts taxes the central bank

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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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Aggregate output and the interest rate are ____ related to government spending and are _ related to taxes.