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

Total utility of a commodity is measured by which price of that commodity.

Question # 2

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

Question # 3

in the Keynesian cross diagram, a decrease in investment spending because companies become more pessimistic about investment profitability causes the aggregate demand function to shift _____the equilibrium level of aggregate output to ______l and the IS curve Curve to shift to the.

Question # 4

The market price of bonds can fluctuate depending on

Question # 5

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 # 6

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

Question # 7

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

Question # 8

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

Question # 9

When there is no change in central banking holding of international reserve balances a country's

Question # 10

A major advantage of monetary over fiscal policy is that monetary policty.

Question # 11

Automatic stabilizers

Question # 12

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

Question # 13

Fiscal policy refers to.

Question # 14

Which of the following would qualify as an aggregate demand shocks.

Question # 15

A sale of bonds by the central bank should cause.

Question # 16

In an economy experience high interest rates and high unemployment The ISLM frame work predicts that _________ policy has been too.

Question # 17

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 # 18

In the Keynesian cross diagram, a decline in autonomous consumer expenditure causes the aggregate demand function to shift ______ and the equilibrium level of aggregate output to.

Question # 19

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 # 20

If firms paying employees monthly began paying them weakly then the demand for money would.

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PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 In the Keynesian corss diagram, and cline in autonomous consumer expenditure causes the aggregate demand function to shift _____ the equilibrium level of aggregate output to fall, and the IS curve to shift to the.
A. up ; left
B. up ; right
C. down ; left
D. down ; right
2 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.
3 The Central Bank controls money and credit with the exception of.
A. Controlling the money base through open market operations
B. Controlling reserve requirements
C. Setting the discount rate of interest
D. controlling the stock market
4 "Although he didn't say so, this may ultimately compet the central bank to resort increasingly to managing the money supply by managing banks excess cash reserves the stuff from which the banks create loans". How would the central bank manages these excess reserves.
A. By buying bonds
B. By selling bonds
C. By changing reserve requirements
D. All of the above
5 In the Keynesian cross diagram, an increase in autonomous consumer function to shift _______ the equilibrium level of aggregate output to rise and the IS curve to shift to the.
A. up ; left
B. up ; right
C. down ; left
D. down ; right
6 An autonomous rise in __________ note causes by a change in the price level aggregate output of the interest shifts the _________ curve to the
A. Net exports LM right
B. Net exports LM left
C. Money demand IS right
D. Money demand LM left
7 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
8 By financial crowding our economists mean
A. What the government borrows cannot be used for private investment
B. Government borrowing drives up interest rates.
C. Bank of England controls on commercial bank lending
D. Credit rationing
9 Per Capita income is obtained by dividing National income by
A. Total labor Force in the country
B. Unemployed Youth in the country
C. Total population of that country
D. None
10 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

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