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

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

Question # 2

Intermediate goods are meant for

Question # 3

An increases in the quantity of money supplied shifts the money supply curve to the _____and the LM curve to the

Question # 4

A rise in planned investment spending unrelated to the interest rate causes teh equilibrium level of aggregate output to __________ at shifts the _____ curve to the _______

Question # 5

The intersection of the IS and LM curves captures.

Question # 6

An increase in autonomous consumer expenditure causes the equilibrium levelof aggregate output to _______ at any given interest rate and shifts the ____ curve to the

Question # 7

What major advantage of monetary policy over fiscal policy does this clipping underline.

Question # 8

Increasing the government budget deficit.

Question # 9

The increase in base money divided by the corresponding induced increasing commercial bank deposits is the.

Question # 10

"Transactions" money is money used as a

Question # 11

By controlling the monetary base economists mean

Question # 12

Disposable income is obtained by subtracting ________ taxes from personal income

Question # 13

A Political problem with discretionary fiscal policy is the.

Question # 14

A monetary expansion is characterized by

Question # 15

If the Central Bank wanted to decrease the quantity of money held by the public it would.

Question # 16

A state of government bonds by the central bank should cause

Question # 17

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

Question # 18

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

Question # 19

A change in the money supply has a greater effect upon equilibrium income.

Question # 20

There are _______ major instrument of monetary policy.

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PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 If Federal reserve conducts open market sales, the money supply ___ shifting the LM curve to the_____
A. decreases ; right
B. decreases ; left
C. Increases ; right
D. Increase ; left
2 An autonomous increase in the value of the domestic exchange rate.
A. Increases output net exports and the interest rate.
B. Decreases output net exports and the interest rate
C. Decreases output and net exports and increases the interest rate.
D. Increase output and decreases net exports and the interest rate.
3 If the Federal reserve conducts open market __ the money supply __ shifting LM curve to the left.
A. Purchases ; decreases
B. sales ; decreases
C. purchases ; increases
D. sales ; increases
4 There are _______ major instrument of monetary policy.
A. Three
B. Four
C. Five
D. None
5 Monetary policy can affect output.
A. this statement is always true
B. This statements always false
C. This statement is true only in the short run
D. This statement is true only in the medium run and the long run
6 In an economy experience high interest rates and high unemployment The ISLM frame work predicts that _________ policy has been too.
A. fiscal ; expansionary
B. fiscal ; contractionary
C. monetary ; expansionary
D. monetary ; contractionary
7 When a government prints money to finance its expenditures it is likely to cause
A. Unemployment
B. Inflation
C. Deflation
D. Reductions in the use of barter
8 The market price of bonds can fluctuate depending on
A. How many bonds were sold
B. Who bought the bonds
C. The amount of the coupon
D. The interest rate
9 The idea that the money supply should change to accommodate changes in aggregate demand is associated with the ideas of.
A. Milton Friedman
B. Ronald reagan
C. Margaret Thatcher
D. John Maynard Keynes
10 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.
A. Milton Friedman
B. Ronald Reagan
C. Margaret Thatcher
D. John Maynard Keynes

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