Economics MCQs

Page No. 291

A fall in investment demand can result from ?


a higher interest rates


blower expected future profits


cmore expensive capital goods


dAll of the above


View Answer All of the above

One of the transmission mechanisms of monetary policy is through consumer demand when interest rates ________ household wealth ________ and consumption _________?


arise; increase, increase


brise, falls, increase


c rise, increase, falls


drise, falls, falls


View Answer rise, falls, falls

Equilibrium in the Money market will change if there is ?


aa change in the real money supply


b a change in real income


ca change in competition in the banking industry


dany of the above


View Answer any of the above

The monetary base is ________ and _________?


a bank deposits, building society deposits


b Currency in circulation, banks cash reserves


cretail sight deposits building society deposits


dretail deposits, wholesale deposits



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


afall


bnot change


cincrease


dNone of these


View Answer increase

Three variables affect the demand for money they are _______ and __________?


abank opening hours, the proportion of weekly paid employee’s interest rates


b the price level interest rates real income


cThe time of year bank opening hours the price level


dThe proportion of weekly paid employees the time of year real income



The money supply is ?


a State Bank of Pakistan Issue Department


b Money + bank cards + credit cards


cCheques + money + bank cards + credit cards


dCurrency in circulation plus bank deposits



The primary function of bank is to ?


a Control the money supply


b Provide notes and coins for trade


cMake a profit


dProvide a cheque clearing system


View Answer Make a profit

Keynesians and monetarists differ over how steep the IS and LM curves actually are Monetarists claim that the IS curve must be __________ and the LM curve must be __________?


a flat; steep


b flat; flat


csteep; flat


dsteep; steep


View Answer flat; steep

When the money supply increase ?


athe economy moves up the LM curve


b The LM curves shifts to the left


c The economy moves down the LM curve


dThe LM curve shift to the right



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