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

Try The 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

What is the significance of underestimating transactions money.

Question # 2

An autonomous increase in money demand.

Question # 3

A tax increase __________ disposable income ____ consumption expenditure and shifts the IS curve to the.

Question # 4

Employment tends to _______ whwn aggregate output.

Question # 5

An example of nondiscretionary fiscal policy would be.

Question # 6

The opportunity cost of holding currency decreases when.

Question # 7

Intermediate goods are meant for

Question # 8

The situation in which the imports are greater than exports is termed as.

Question # 9

Monetary policy can affect output.

Question # 10

An example of discretionary fiscal policy would be.

Question # 11

Which policies are expenditure changing policies.

Question # 12

If the Bank of Pakistan wished to pursue an expansionary monetary policy it would.

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 main role of the Federal Reserve is to

Question # 15

According to classical models, the level of employment is determined primarily by

Question # 16

During periods of negative demand shocks deficit target reductions such as those mandated in the Gramm Rudman Hollings Act would tend to.

Question # 17

The government performs its redistribution function mainly through.

Question # 18

Believers in the monetarist rule assert that

Question # 19

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

Question # 20

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

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PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 When your grandmother keeps her savings hidden under her mattress she is using money as.
A. a standard of deferred panyment
B. A comfortable thing for sleeping
C. A medium of exchange
D. A store of value
2 Why do people keep currency in their pockets when bank deposits pay interest.
A. Because banks might steal your money
B. Because currency is more liquid
C. Because bank deposits lose value due to inflation
D. Because bank deposits lose value due to exchange in interest rates.
3 There are ______ methods of measuring GDP
A. Three
B. Four
C. Five
D. None
4 The rate of which central bank lends to commercial banks is known as
A. reserve rate
B. Discount rate
C. Open market operation
D. None
5 If the nominal money supply doubles while real money demand is unchanged what happens to the price level.
A. The price level increases by a factor of four
B. The price level doubles
C. The price level is unchanged
D. The price level falls by one half.
6 If the State bank of Pakistan wished to pursue a light monetary policy it would.
A. Lower the required reserve ratio and the statutory liquidity ratio.
B. Lower interest rates
C. Buy government securities on the open market
D. Sell government securities on the open market
7 Commercial banks
A. Are financial intermediaries that offer demand deposits.
B. Are owned by the Federal Reserve
C. Are non profit banking institutions
D. Are overseen by the Federal savings and loan insurance corporation.
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 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.
A. store of value
B. Unit of account
C. Medium of exchange
D. Standard of deferred payment
10 If a perfectly competitive industry is in long run equilibrium all firms will
A. Have a marginal costs
B. Have identical supply curves
C. Operate at the point where marginal cost just covers all variable costs
D. Have equal fixed costs

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