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

Fiscal policy is purposeful movements in _____designed to direct an economy

Question # 2

The purpose of financial intermediaries is.

Question # 3

A business cycle refers to.

Question # 4

How much of the Rs.5 billion dollar increase in government expenditures will be recouped in taxes.

Question # 5

An increase in oil prices, such as the oil shocks in the 70 s, lead to _______ there by causing _____

Question # 6

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

Question # 7

The quantity of money demanded increases with income Thus if income increases the opportunity cost of holding money demand and re establish equilibrium in the money market This relation is captured by.

Question # 8

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.

Question # 9

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

Question # 10

During periods of negative demand shocks deficit target reductions such as those mandated in the Gramm Rudman Hollings Act would tend to.

Question # 11

As the interest sensitivity of investment spending increase.

Question # 12

The main source of interest profits for banks is.

Question # 13

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

Question # 14

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

Question # 15

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

Question # 16

Automatic stabilizers

Question # 17

Net taxes are.

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

During period of inflation

Question # 20

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

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PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 During periods of negative demand shocks deficit target reductions such as those mandated in the Gramm Rudman Hollings Act would tend to.
A. Stimulate the economy and increase empolyment.
B. Result in additional recessionary declines in employment and income
C. Stimulator defiance spending
D. Have an automatic stabilizing impact upon the economy
2 When the value of the Rupee rises Pakistan goods become _____ expensive relative to foreign goods which ___ exports.
A. more ; iincreases
B. less ; increases
C. more ; decreases
D. more ; increases
3 using money as a medium of exchange.
A. Requires people to math goods wanted with goods available.
B. Reduces the range of feasible exchanges in the economy
C. Inhibits economic transactions
D. Reduces the need for barter in the economy.
4 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
5 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.
6 The quantity of money demanded varies
A. Directly with both prices and output
B. Inversely with both prices and output
C. Directly with prices and inversely with output
D. Inversely with prices and directly with output
7 The investment demand curve shows the relationship between the levels of.
A. Investment and consumption
B. Consumption and Interest rate
C. Investment and interest rate
D. None
8 During the early years of the Great depression there was a significant decrees n the the money supply that causes. the ______ to shift____
A. LM ; Leftward
B. LM ; rightward
C. IS ; Leftward
D. IS ; rightwards
9 An increases in the value of the Rupee makes foreign goods cheaper relative to Pakistan goods, resulting in a _______ in net exports and a __ shift of the IS curve
A. fall ; leftward
B. rise ; leftward
C. fall ; rightward
D. rise ; rightward
10 A bonds becomes a riskier asset the demand for money_______ and all else constant, the equilibrium interest rate
A. Rises ; rises
B. rises ; falls
C. falls ; rises
D. falls ; falls

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