PPSC Economics Topic 4 MCQS Test Preparation

Punjab Public Service Commission, PPSC takes the competitive exam to offer the deserving candidates suitable positions in several governmental organizations. Candidates who are willing to apply for the coming PPSC examination session with the subject of Economics are advised to start their preparation as soon as possible. The reason behind this endorsement is that candidates with exceptional results secure suitable positions and the exceptional result is a result of exceptional preparation.

MCQ's Test For PPSC Economics Topic 4 Monetary & Fiscal Policy

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PPSC Economics Topic 4 Monetary & Fiscal Policy

00:00
Question # 1

Net taxes are.

Question # 2

Short run contractionary Fiscal policy would result in.

Question # 3

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

Question # 4

Commercial banks

Question # 5

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

Question # 6

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

Question # 7

You know that all taxes are distortionary under what conditions will this knowledge lead you to appose the imposition of every single tax in the economy.

Question # 8

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

Question # 9

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

Question # 10

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 __________

Question # 11

The implementation lag for monetary policy is generally

Question # 12

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

Question # 13

In the Keynesian corss diagram, and cline 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.

Question # 14

The IMF is an agency charged with providing.

Question # 15

How much of the Rs.5 billion dollar increase in government expenditures will be recouped in taxes.

Question # 16

A decrease in the quantity of money supplied shifts the money supply curve to the _____ and the LM curve to the

Question # 17

A decline in the money__________ shifts the LM curve to the ____ causing the interest rate to rise and output to fall.

Question # 18

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.

Question # 19

Money and income are.

Question # 20

The ____ lag for fiscal policy is generally _____ than it is for monetary policy.

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PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 Consider the five panels of the figure on the previous page in which panel would the simultaneous imposition of restrictive monetary policy and expansionary fiscal policy cause the largest increase in interest rates.
A. Panel a
B. Panel b
C. Panel c
D. Panel d
2 A decrease iin money demand other thing equal shifts the _____ curve to the
A. IS ; right
B. Is ; Left
C. LM ; Left
D. LM ; Rfight
3 "Transactions" money is money used as a
A. Store of value
B. Unit of account
C. Medium of exchange
D. Standard of deferred payment
4 The ____ lag for fiscal policy is generally _____ than it is for monetary policy.
A. Recognition ; shorter
B. Recognition ; longer
C. Implementation ; shorter
D. Implementation ; longer
5 How much of the Rs.5 billion dollar increase in government expenditures will be recouped in taxes.
A. Rs.1 billion
B. Rs.2 billion
C. Rs.0.9 billion
D. Rs.0.5 billion
6 Under a fixed exchange rate system an expansionary fiscal policy leads to a
A. Trade account deficit and a capital account surplus.
B. Trade account deficit and a capital account deficit
C. Trade account surplus and a capital account surplus
D. Trade account surplus and a capital accoundt deficit
7 There are ______ methods of measuring GDP
A. Three
B. Four
C. Five
D. None
8 What's the most common way for a central bank to reduce the money supply.
A. Collect higher taxes
B. Sell bonds to the public
C. Buy bounds from the government
D. Buy bonds from the public
9 During period of inflation
A. Those people who have fixed incomes benefit
B. Every one's real income falls
C. those people who enter long term wage agreements benefit
D. Those people whose real income rises faster than the general price level benefit
10 During the early years of the Great depression there was a significant decrees n the the money supply that causes. the ______ to shift____
A. LM ; Leftward
B. LM ; rightward
C. IS ; Leftward
D. IS ; rightwards

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