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

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Question # 1

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

Question # 2

The function of money do not include.

Question # 3

The market price of bonds can fluctuate depending on

Question # 4

"Far better for central bankers to get out of the fine tuning business instead they should d try to keep.

Question # 5

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 # 6

Believers in the monetarist rule assert that

Question # 7

The ____ lag for fiscal policy is generally _____ than it is for monetary policy.

Question # 8

When the value of the Rupee rises Pakistan goods become _____ expensive relative to foreign goods which ___ exports.

Question # 9

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

Question # 10

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

Question # 11

A decrease in the quantity of money supplied shifts the money supply curve to the _____ and the LM curve to the

Question # 12

Automatic stabilizers

Question # 13

The opportunity cost of holding currency decreases when.

Question # 14

"Transactions" money is money used as a

Question # 15

In the Keynesian cross diagram an increasing investment spending because companies become more optimistic about investment profitability causes the aggregate demand function to shift ______ and the equilibrium level of aggregate output to rise and the IS curve to shift to the

Question # 16

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 # 17

A decline in taxes __ consumer expenditure and shifts the _ curve shifts to the.

Question # 18

Which of the following events will lead to a decrease in the demand for money.

Question # 19

Disposable income is obtained by subtracting ________ taxes from personal income

Question # 20

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.

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PPSC Chapter 4 Important MCQ's

Sr.# Question Answer
1 An item designed as money that is intrinsically worthless could the.
A. A currency note
B. A silver coin
C. A barter item
D. Any tradeable commodity
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 The largest source of tax revenue for the federal government is.
A. The personal income tax
B. The social security tax
C. The property tax
D. The sales tax
4 An increase in oil prices, such as the oil shocks in the 70 s, lead to _______ there by causing _____
A. A movement along the AS curve cost push inflation
B. A leftward shift int he AS curve demand pull inflation.
C. A right ward shift in the AS Curve cost push inflation
D. a left ward shift in the AS curve cost push inflation
5 The main source of interest profits for banks is.
A. Checking account fees
B. Loans
C. Government securities
D. Savigng accounts
6 in The Liquidity trap region
A. Fiscal policy is not effective
B. Monetary policy is completely ineffective
C. Monetary policy is completely effective
D. Fiscal policy and monetary policy are equally effective
7 The quantity theory of money allows monetarists to obtain a number of economics predictions by assuming a constant.
A. Velocity of money
B. Nominal output
C. Overall price level
D. Stock of money
8 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
9 The opportunity cost of holding currency decrease when
A. Income decreases
B. The interest rate on bonds decreases
C. The interest rate on money decrease wealth decrease
D. Wealth decreases
10 "The impact on this monetary aggregate of extensive finance innovation -the changes in the kinds of deposits and services offered by banks led the central bank to drop M1 as a n intermediate target with the changes in the way the public was holding payments balances the M1 aggregate no longer that the same reliable link to.
A. Tax rates
B. The money supply
C. Aggregate demand
D. Government spending

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