PPSC Economics Topic 4 Monetary & Fiscal Policy

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PPSC Economics Chapter 4 Important MCQ's

Sr.#	Question	Answer
1	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	A. up ; right B. up ; left C. down ;left D. down ; right
2	Employment tends to _______ whwn aggregate output.	A. rise, falls B. rise ; rises C. falls; rises D. Not change ; falls
3	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
4	Knowledge of the money supply can lead to good predications of nominal GDP only	A. If the price level is stable B. If the money supply is stable C. Over very short periods of time D. If the determinants of velocity are known
5	an asset that can easily be exchanged for goods and services is called a.	A. Financial asset B. Barter like asset C. Illegitimate asset D. Liquid asset
6	The equilibrium level of saving is.	A. Rs.120 B. Rs.75 C. Rs.40 D. Rs.80
7	The function of money do not include.	A. an exchange of purchasing power B. A unit of account C. A medium of exchange D. A store of value
8	Credit constitutes.	A. Saving made available to borrowers B. A form of liquid asset C. bank loans converted into commodity money D. Money used as a standard of deferred payment.
9	An increase in expected inflation is likely ot cause.	A. A decline in the demand for real balances B. an increase in the demand for real balances. C. No change i the demand for real balances D. No change in the demand for real balances only of the income elasticity of real money demand is zero.
10	How much of the Rs. 5 billion dollar increase in the government expenditures will be financed by bond sales.	A. Rs.3.5 billion B. Rs.1.5 billion C. Rs. 4.9 billion D. Rs.2.8 billion

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PPSC Economics Topic 4 MCQS Test Preparation

MCQ's Test For PPSC Economics Topic 4 Monetary & Fiscal Policy

PPSC Economics Topic 4 Monetary & Fiscal Policy

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

The quantity of money demanded varies.

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

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

Why do people keep currency in their pockets when bank deposits pay interest.

Those who favor setting the target rate of inflation at about 3% believe.

An increase in autonomous consumer expenditure causes the equilibrium levelof aggregate output to _______ at any given interest rate and shifts the ____ curve to the

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

By financial crowding our economists mean

an asset that can easily be exchanged for goods and services is called a.

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 ______ and the equilibrium level of aggregate output to ______

The IMF is an agency charged with providing.

a contractionary monetary policy

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.

"The earlier predictions underestimated currency in circulation and treasury balances at the Fed, both of which drained reserves from the banking system" Lower reserves means.

The function of money do not include.

A decline in the value of the rupee makes Pakistan goods cheaper relative to foreign goods, resulting in a _________ in net exports and a ________shifts of the IS curve.

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

Which of the following causes M1 demand is decrease.

The purpose of financial intermediaries is.

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Topic Test

Top Scorers Of PPSC Economics Topic 4 Monetary & Fiscal Policy MCQ`s Test

PPSC Economics Chapter 4 Important MCQ's

Test Questions

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The lag for fiscal policy is generally _ than it is for monetary policy.

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

An increase in autonomous consumer expenditure causes the equilibrium levelof aggregate output to ___ at any given interest rate and shifts the curve to the

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 and the equilibrium level of aggregate output to

A decline in the value of the rupee makes Pakistan goods cheaper relative to foreign goods, resulting in a _ in net exports and a shifts of the IS curve.