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

  • Total Questions20

  • Time Allowed20

Start Test Download PDF

PPSC Economics Topic 4 Monetary & Fiscal Policy

00:00
Question # 1

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

Question # 2

Following the work of _____________ in the 1960s, and the controversy associated with these views in the 1970s, there was a revival of interest by economists and government in monetary policy.

Question # 3

The quantity theory of money allows monetarists to obtain a number of economics predictions by assuming a constant.

Question # 4

If the Federal reserve conducts open market ________ the money supply _______ shifting the LM curve to the right.

Question # 5

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

Question # 6

Consider the five panels of the figure on the previous page in which panel would fiscal policy be the strongest.

Question # 7

The intersection of the IS and LM curves captures.

Question # 8

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 # 9

The quantity of money demanded varies

Question # 10

Money's primary role in the economy comes from the benefits of lowering transactions costs and allowing specialization This function of money is called.

Question # 11

The relation between M2 and inflation is tighter than the relation between M1 and inflation because.

Question # 12

Under a fixed exchange rate system an expansionary fiscal policy leads to a

Question # 13

The money multiplier is 4, and the money creating potential of the banking system is Rs. 40,000,000. The legal reserve ratio and the excess reserves are.

Question # 14

A decline in planned investment spending unrelated to the interest rate focuses the equilibrium level of aggregate output to ________ and shifts the _ curve to the _______

Question # 15

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

Question # 16

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

Question # 17

The purpose of financial intermediaries is.

Question # 18

Knowledge of the money supply can lead to good predications of nominal GDP only

Question # 19

What's the most common way for a central bank to reduce the money supply.

Question # 20

In the case of an expansionary ___ policy the interest rate rise while in the case of an expansionary _______ policy the interest rate falls.

Submit

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


Topic Test

00:00
Submit

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

  • S
    Shiza Amir 25 - May - 2022 02 Min 08 Sec 18/20
  • K
    khurram shazzz 02 - Mar - 2022 04 Min 47 Sec 18/20
  • S
    Shahida 01 - Sep - 2021 06 Min 25 Sec 17/20
  • A
    Ayesha siddiqa 02 - Jul - 2021 19 Min 10 Sec 17/20
  • T
    Tayyeba 29 - Jun - 2021 09 Min 28 Sec 16/20
  • F
    Funny world with amazing facts 22 - Apr - 2022 06 Min 10 Sec 15/20
  • S
    sidra Naeem 22 - May - 2022 13 Min 44 Sec 13/20
  • A
    Abdul Qayyum 25 - May - 2024 07 Min 53 Sec 12/20
  • H
    Hassan Mehmood 03 - Apr - 2022 08 Min 20 Sec 12/20
  • S
    Shama Suleman 21 - May - 2022 12 Min 21 Sec 12/20
  • A
    Amjad Ali 07 - Jun - 2023 12 Min 49 Sec 12/20
  • S
    Shad Ali Shah 27 - Jul - 2024 15 Min 17 Sec 12/20
  • D
    DJ DJ 12 - Aug - 2022 11 Min 02 Sec 11/20
  • Z
    zaheer hussain 18 - Jan - 2024 14 Min 06 Sec 11/20
  • M
    Mahnoor NaSir 24 - May - 2022 07 Min 27 Sec 9/20

PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 Automatic stabilizers
A. Counter balance fluctuations in economic activity.
B. Reinforce fluctuations in economic activity
C. Do not occur when the economy falls into recession
D. Reduces the size of the deflationary gap
2 The use of money is more efficient than barter because the introduction of money
A. Reduces the need for economic specialization
B. Reduces the need to exchange goods
C. Reduce the need for other stores of value
D. Reduces transaction costs
3 An increase in government spending 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 ; LM ;Left
C. fall ; IS ; Left
D. rise ; IS ;right
4 As the interest sensitivity of investment spending increase.
A. Monetary policy has a larger effect on output
B. Fiscal policy has a larger effect on output
C. The multiplier increases
D. All of the above
5 A sale of bonds by the central bank should cause.
A. A fall in the interest rate
B. An increase in the money supply
C. A decrease in the reserves of the commercial banks
D. An increase in the commercial banks loans to the public
6 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
7 Those who favor setting the target rate of inflation at about 3% believe.
A. The cost of moderate inflation can be minimized by indexing the tax system and bonds
B. that the cost of going to 0% is very low
C. That moderate inflation increases money illusion
D. Believe that moderate inflation aggravates the time inconsistency problem
8 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
9 "Rising productivity does not in itself spell the end of inflation. With enough______ it would still be possible to whip prices into a froth the blank is best filled with.
A. Income growth
B. Unemployment
C. Money growth
D. Taxes
10 As a result of the increase in government expenditures disposable income increases by.
A. Rs.10 billion
B. Rs.9 billion
C. Rs.20 billion
D. Rs.5 billion

Test Questions

Is this page helpful?

Share your comments & questions here

Guest

  • No comments yet. Be the first to comment!