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

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

Question # 2

Which of the following is not an important variable in growth accounting calculations.

Question # 3

An autonomous decline in the value of the Pakistan Rupee makes Pakistan goods _______ relative to foreign goods and results in a ______ in net exports.

Question # 4

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 # 5

A good that is used as a medium of exchange as well as being a consumption good is called.

Question # 6

If Federal reserve conducts open market sales, the money supply ___ shifting the LM curve to the_____

Question # 7

The money multiple tells us teh ultimate increase in.

Question # 8

The situation in which the imports are greater than exports is termed as.

Question # 9

a contractionary monetary policy

Question # 10

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

Question # 11

An example of nondiscretionary fiscal policy would be.

Question # 12

The parable of Riding a Switchback suggests that stabilizing policy.

Question # 13

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 # 14

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 # 15

The economic logic behind granting central bank's independence from governmental the conduct of monetary policy is.

Question # 16

A decrease in autonomous consumer expenditure causes the equilibrium level of aggregate output to __________ at any given interest rate and shifts the _______ curve to the __________

Question # 17

A state of government bonds by the central bank should cause

Question # 18

Which policies are expenditure changing policies.

Question # 19

Commercial banks

Question # 20

A monetary expansion is characterized by

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PPSC Economics Chapter 4 Important MCQ's

Sr.# Question Answer
1 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
2 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
3 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
4 As the required reserve ratio is decreased the money multiplier.
A. Could either increase or decrease
B. Remains the same as long as banks hold no excess reserves
C. Increase
D. Decreases
5 The real money demand doubles while the nominal money supply is unchanged what happens to the price level.
A. The price level increase by a factor of four
B. The price level doubles
C. The price level is unchanged
D. The price level falls by one half.
6 Keynes suggested that ________ income households consume a ____ proportion of their income than ____ income households.
A. Low ; smaller ; high
B. Low ; larger ; high
C. low ; smaller ; middle
D. High ; larger ; low
7 "Rising productivity does not in itself spell the end of inflation. With enough______ it would still be possible to whip prices into a froth the blank is best filled with.
A. Income growth
B. Unemployment
C. Money growth
D. Taxes
8 When your grandmother keeps her savings hidden under her mattress she is using money as.
A. a standard of deferred panyment
B. A comfortable thing for sleeping
C. A medium of exchange
D. A store of value
9 Which of the following causes M1 demand is decrease.
A. A fall in the tax rate
B. An increase in income
C. A fall in the interest rate
D. An increase in the use of credit cards
10 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

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