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

What technical terminology do economists use to refer to how much the money will multiply as this process unfolds.

Question # 2

The idea that the money supply should change to accommodate changes in aggregate demand is associated with the ideas of.

Question # 3

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

Question # 4

What happens to the money supply if the deficit is financed by selling bonds to the general public.

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

An increase in money demand other thing equal shifts the ____ curve to the___

Question # 7

There are ______ methods of measuring GDP

Question # 8

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

Question # 9

An increase in the quantity of money supplied shifts the money supply curve to the_______ and the equilibrium interest rate

Question # 10

Why would corporations want to achieve zero balances in their checking accounts.

Question # 11

The budget deficit tends to decrease when

Question # 12

a contractionary monetary policy

Question # 13

Believers in the monetarist rule assert that

Question # 14

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

Question # 15

If the Federal reserve conducts open market __ the money supply __ shifting LM curve to the left.

Question # 16

The purpose of financial intermediaries is.

Question # 17

The government performs its redistribution function mainly through.

Question # 18

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

Question # 19

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

Question # 20

The opportunity cost of holding currency decrease when

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PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 A decline in taxes __ consumer expenditure and shifts the _ curve shifts to the.
A. Raises ; LM; Right
B. Lowers; IS ; left
C. raises ; IS; right
D. Lower ; LM; left
2 In the Keynesian cross diagram a decline 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
A. rise,; left
B. rise ;right
C. fall ; left
D. fall ; right
3 The budget deficit tends to decrease when
A. GDP increases
B. GDP decreases rapidly
C. GDP remains unchanged
D. GDP decreases slightly
4 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
5 According to classical models, the level of employment is determined primarily by
A. The level of aggregate demand for goods and services
B. Prices and wages
C. Government taxation
D. Government spending
6 You move some of your savings account balance into your checking account.
A. M2 falls and M1 rises
B. M1 falls and M2 rises
C. M1 and M2 are unchanged
D. M1 rises and M2 remains unchanged
7 The main source of interest profits for banks is.
A. Checking account fees
B. Loans
C. Government securities
D. Savigng accounts
8 If young busness professionals in Pakistan suddenly decide that driving japan made cars is an important status symbol net exports will tend to _____________causing aggregate demand to.
A. fall ; fall
B. fall ; rise
C. rise ; fall
D. rise ; rise
9 Money and income are.
A. Mirror image of each other
B. Two quite different concepts
C. Both measured as a per annum flow
D. Two ways of looking at the same thing.
10 The negative effect on the economy that occurs when average tax rates increases because taxpayers have moved into higher income brackets during an expansion is.
A. Fiscal drag
B. The Laffer curve
C. Bracket creep
D. Debt burden

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