PPSC Economics Topic 4 Monetary & Fiscal Policy

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zaheer hussain 18 - Jan - 2024 14 Min 06 Sec 11/20
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Mahnoor NaSir 24 - May - 2022 07 Min 27 Sec 9/20

PPSC Economics Chapter 4 Important MCQ's

Sr.#	Question	Answer
1	Money's primary role in the economy comes from the benefits of lowering transactions costs and allowing specialization This function of money is called.	A. Store of value B. Medium of exchange C. Standard of deferred payment D. Unit of account
2	When a nations money supply is Rs.1200 billion and the nominal Gros National product is Rs.4800 billion the velocity of money is.	A. 0.25 B. 4 C. 0.4 D. Rs.4 billion
3	An autonomous increase in money demand.	A. Shift the IS curve to the right B. Shifts the IS curve to the left C. Shift the LM curve to the right D. Shift the LM curve to the left
4	An example of nondiscretionary fiscal policy would be.	A. The operation of the welfare state B. A Federal jobs program adopted to stimulate consumption C. A tax cut adopted to stimulate consumption D. An interest rate cut implemented to stimulate consumption
5	According to the Laffer curve as tax rates increase tax revenues.	A. Decrease continuously. B. Initially decrease and then increase C. Rise continuously D. Initially increase and then decrease
6	Fiscal policy refers to.	A. The actions of the central bank in controlling the money supply B. The government's altitude to taxation C. The spending and taxing policies used by the government to influence the economy D. The governments regulation of financial intermediaries.
7	Increases in government spending increase interest rates and aggregate output in the ISLM framework this is a ____ shift of the _____ curve.	A. Left ward ; LM B. Right ; LM C. Left ward ; IS D. Left ward ; AD
8	Suppose velocity is constant and the real income elasticity of the demand for money is less than one then estimating inflation as money growth rate minus real growth rate.	A. Overestimates inflation B. Underestimates inflation C. Is an erratic estimate of inflation D. Remain an accurate estimate of inflation.
9	The market price of bonds can fluctuate depending on	A. How many bonds were sold B. Who bought the bonds C. The amount of the coupon D. The interest rate
10	Money or paper currency serves at least _______ functions.	A. Three B. Four C. Five D. Seven

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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

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

Which of the following persons would be considered unemployed.

The investment demand curve shows the relationship between the levels of.

When the central Bank ________ the money supply the LM curve shifts to the _______ interest rates ____________ and equilibrium aggregate output.

Monetary policy can affect output.

Credit constitutes.

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

Keynes suggested that ________ income households consume a ____ proportion of their income than ____ income households.

The near term effect of an unexpected sale of bonds by the central bank is.

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

The money multiplier is 4, and the money creating potential of the banking system is Rs. 40,000,000. The legal reserve ratio and the excess reserves are.

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

The ratio of debt to GDP will be larger

If firms paying employees monthly began paying them weakly then the demand for money would.

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

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

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

A Political problem with discretionary fiscal policy is the.

In the money market a condition of excess supply of money cna be eliminated by a _________ in aggregate output or a __ in the interest rate , both of which increase the quantity of money demanded.

Prepare Complete Set Wise PPSC Economics Topic 4 Monetary & Fiscal Policy MCQs Online With Answers

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Set 12

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Set 14

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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When the central Bank ____ the money supply the LM curve shifts to the _ interest rates __________ and equilibrium aggregate output.

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

Keynes suggested that ____ income households consume a proportion of their income than income households.

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

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

In the money market a condition of excess supply of money cna be eliminated by a _______ in aggregate output or a in the interest rate , both of which increase the quantity of money demanded.