economics MCQs – Page 238

Practise multiple-choice questions from economics for competitive examinations and subject revision. Review each marked answer and report any item that may be outdated or unclear.

economics Mcqs
1. the national economy2. profit maximizing under perfect competition and monopoly3. application of economics4. the aggregate demand aggregate supply model5. surplus6. money interest rates and output7. average and total cost8. stabilization adjustment reform and privatization9. risks and diversification efficient market hypothesis10. the phillips curve11. supply and demand12. capital formation investment choice information technology and technical progress13. aggregate supply unemployment and inflation14. elasticity15. comparative gdp16. roots of modern macroeconomics17. production factors18. poverty malnutrition and income inequality19. trade regulations and industrial policies20. monetary union21. exchange rate systems and currency crises22. economic development in historical perspective23. exchange rate determination24. monopoly competition25. the balance of payments26. inflation productivity27. macroeconomic issues and analysis28. employment migration and urbanization29. macroeconomic policy tools30. supply side policies31. exchange rate adjustments and the balance of32. miscellaneous33. taxation34. trade policies for the developing nations35. markets efficiency and the public interest36. the external debt and financial crises37. budget deficits and the trade balance38. alternative theories of the firm39. public goods40. the meaning and measurement of economic development41. characteristics and institutions of developing countries42. agriculture irrigation system of pakistan43. education health and human capital44. economic problems of developing countries45. theories of economic development46. basic of economics47. consumer theory vs real consumers48. applied microeconomics49. long term economic growth50. externality internality51. fiscal and monetary policy52. prices wages taxes53. balance of payments aid and foreign investment54. international factor movements and multinational corporations55. entrepreneurship organization and innovation56. the international economy and globalization57. population and development58. non tariff trade barriers59. foundations of modern trade theory60. global economic development61. market62. rural poverty and agricultural transformation63. regional trading arrangements64. foreign exchange65. introduction to economics66. world economy miscellaneous67. sources of comparative advantage68. natural resources and the environment toward sustainable development69. monopoly70. asymmetric information71. income inequality72. labour market73. tariffs74. development planning and policy making the state and the market75. oligopoly76. industrial development77. costs supply and perfect competition78. human capital79. monetary fiscal and incomes policy and inflation80. stocks
4741. If the investment demand curve is vertical ?
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A. both monetary and fiscal policy are ineffective

B. monetary policy is effective but fiscal policy is ineffective

C. monetary policy is ineffective but fiscal policy is effective

D. both monetary and fiscal policy are effective

4742. When real income increases other things equal we can expect the demand for real money holdings to ?
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A. fall

B. not change

C. increase

D. None of these

4743. Money is ?
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A. Anything that is generally accepted as a medium of exchange

B. All of the above

C. The value of all coins and currency in circulation at any time

D. The same as income

4744. Each point on the IS curve represents the equilibrium point in the ?
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A. money market for the given value of aggregate output

B. goods market for the given level of government spending

C. goods market for the given interest rate

D. money market for the given level of the money supply

4745. A reduction in interest rates, causes an increases in the monetary base that results in an _________ in the availability of consumer credit and a ________ in the cost of consumer credit?
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A. increase , increase

B. reduction, reduction

C. increase, reduction

D. reduction, increase

4746. Equilibrium in the Money market will change if there is ?
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A. a change in the real money supply

B. any of the above

C. a change in real income

D. a change in competition in the banking industry

4747. If banks and the private sector decide to hold less cash the money multiplier will be ?
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A. Unstable

B. Smaller

C. Unchanged

D. Larger
4748. An item designated as money that is intrinsically worthless is ?
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A. precious metals

B. barter items

C. commodity money

D. fiat money
4749. The monetary base is ________ and _________?
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A. retail deposits, wholesale deposits

B. retail sight deposits building society deposits

C. bank deposits, building society deposits

D. Currency in circulation, banks cash reserves
4750. Three variables affect the demand for money they are _______ and __________?
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A. the price level interest rates real income

B. The time of year bank opening hours the price level

C. The proportion of weekly paid employees the time of year real income

D. bank opening hours, the proportion of weekly paid employees interest rates

4751. An example of fiat money is ?
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A. gold

B. Paper euros

C. Silver coins

D. cigarettes

4752. In terms of the demand for money the interest rate represents ?
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A. the rate at which current consumption can be exchanged for future consumption

B. the price of borrowing money

C. The opportunity cost of holding money

D. the return on money that is saved for the future

4753. If the central bank buys financial securities in the open market to increase the monetary base, this is and example of ?
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A. Open Market operations

B. financial intermediation

C. Financial regulation

D. lender of less resort

4754. An increase in the money supply aimed at increasing aggregate output is referred to as ?
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A. contractionary fiscal policy

B. expansionary monetary policy

C. expansionary fiscal policy

D. contractionary monetary policy

4755. The demand for money represents the idea that there is ?
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A. a positive relationship between the interest rate and the quantity of money demanded

B. a negative relationship between the price level and the quantity of money demanded

C. a negative relationship between the level of aggregate output and the quantity of money demanded

D. a negative relationship between the interest rate and the quantity of money demanded
4756. The opportunity cost of holding money is determined by ?
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A. the inflation rates

B. the level of aggregate output

C. the interest rates

D. the discount rates

4757. The curve that illustrates the negative relationship between the equilibrium values of aggregate output and the interest rate in the goods market is the ?
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A. aggregate demand curve

B. aggregate supply curve

C. IS curve

D. LM curve
4758. Which of the following events will lead to an increase in the demand for money ?
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A. An increase in the interest rate

B. An increase in the level of aggregate output

C. A decrease in the price level

D. An increase in the supply of money

4759. Which of the following statements about money is not true ?
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A. A debit card is not really money because it is only a means of transferring money between accounts

B. In a complex economy it is not easy to draw a clear dividing line between assets that should be considered as money and those that should not

C. Wealth held in the current account you hold with your bank is almost as convenient for buying things as wealth held in your wallet so the wealth in current accounts should be included in measures of money

D. All the wealth that people hold, in whatever form, should be considered as money
4760. The chain of events that results from an expansionary monetary policy is ?
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A. money demand increases the interest rate decreases planned investment increases aggregate output increases and money demand increases

B. money supply increases the interest rate increase planned investment increases aggregate output increases and money demand increases

C. money supply increases the interest rate decrease planned investment increases aggregate output increases and money demand increase

D. aggregate output increases the demand for money increase the interest rate increase planned investment