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

When a government prints money to finance its expenditures it is likely to cause

Question # 2

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

Question # 3

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

Question # 4

An autonomous increase in money demand.

Question # 5

The ratio of debt to GDP will be larger

Question # 6

Which of the following persons would be considered unemployed.

Question # 7

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

Question # 8

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

Question # 9

Which school of economic thought suggested that one possible cause of inflation was a push from the cost side.

Question # 10

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.

Question # 11

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

Question # 12

Other things equal a decrease in autonomous consumption shifts the _____ curve to the

Question # 13

Over time the wealth of society increases and payments technologies get more efficient What is the effect on money demand of these two changes.

Question # 14

As the required reserve ratio is decreased the money multiplier.

Question # 15

A shift in tastes toward foreign goods ______ net exports and causes the IS curve to shift to the

Question # 16

"Some economists criticized the central bank for not moving in the face of the waning recovery One who prefers anonymity stated the failure to move today leaves us with low inflation a weak economy and climbing jobless claims these are classic signs of an impending downturn The fed fiddles while the economy burns This economist would want to see.

Question # 17

During the early years of the Great depression there was a significant decrees n the the money supply that causes. the ______ to shift____

Question # 18

An item designed as money that is intrinsically worthless could the.

Question # 19

According to the Laffer curve as tax rates increase tax revenues.

Question # 20

A tax cut __ disposable income _____ consumption expenditure and shifts the IS curve to the.

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PPSC Class Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 An increase in autonomous consumer expenditure causes the equilibrium levelof aggregate output to _______ at any given interest rate and shifts the ____ curve to the
A. rise ; LM ;right
B. rise ; IS ; right
C. fall ; LM, Left
D. rise ; IS ; Left
2 When the central Bank ________ the money supply the LM curve shifts to the _______ interest rates ____________ and equilibrium aggregate output.
A. Increase ; right ; fall; increase
B. increases ; left ; rise ; decrease
C. decreases ; left ;rise ; increases
D. decreases ; left ; fall ; increases
3 The ratio of debt to GDP will be larger
A. The lower the real interest rate
B. The lower the growth rate of output
C. The lower the in initial debt ratio
D. The lower the ratio of the primary deficit to GDP
4 An increase in the money supply shifts the LM curve to the right causing the interest rate to __________ and output to.
A. rise ; rise
B. rise ; fall
C. fall ; rise
D. fall ; fall
5 The IMF is an agency charged with providing.
A. Technical assistance to stock market and financial market problems.
B. Loans for post World War II reconstruction
C. Short term credit for international balance of payments deficits
D. Bonds denominated in U.S. dollars as a loan to LDCs
6 When considering any kind of economics indicator, prices are important because.
A. They reflect the value of goods and services.
B. They are established by the government to control population 's needs
C. They categorize goods and services by their weight
D. Historically they have proved to the good predictors of futures unemployment.
7 During period of inflation
A. Those people who have fixed incomes benefit
B. Every one's real income falls
C. those people who enter long term wage agreements benefit
D. Those people whose real income rises faster than the general price level benefit
8 Short run contractionary Fiscal policy would result in.
A. Aggregate demand moving to the right
B. Aggregate supply moving to the right
C. Aggregate demand moving to the left
D. Aggregate supply moving to the left
9 In the ISLM framework an expansionary monetary policy causes aggregate output to _____________ and the interest rate to
A. increase ; increase
B. Increase ; decrease
C. decrease ; decrease
D. decrease ; increase
10 An increase in the rate of inflation which is not accompanied by any change in the volume of consumer goods sold will automatically increase the.
A. Revenue from value added tax
B. Level of company profits
C. Level of unemployment
D. Average level of wages

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