Question 1

An increase in the interest rate1

Accepted Answer

A) shifts the aggregate demand curve to the left 
B) shifts the aggregate demand curve to the right 
C) has no effect 
D) moves the economy along the aggregate demand curve 
A) shifts the aggregate demand curve to the left 
B) shifts the aggregate demand curve to the right 
C) has no effect 
D) moves the economy along the aggregate demand curve A

Question 2

The government spending multiplier is as higher as:

Accepted Answer

A) higher is the government spending 
B) higher is the mpc 
C) lower is the mpc 
D) lower is the tax revenue 
A) higher is the government spending 
B) higher is the mpc 
C) lower is the mpc 
D) lower is the tax revenue B

Question 3

-------controls the supply of money and bank credit:

Accepted Answer

A) rbi 
B) indian banking association 
C) sebi 
D) none of these 
A) rbi 
B) indian banking association 
C) sebi 
D) none of these A

Question 4

Monetary Policy is a regulatory policy by which the -------or monetary authority of a country controls the supply of money, availability of bank credit and cost of money that is the rate of interest:

Accepted Answer

A) central bank (rbi) 
B) sbi 
C) iba 
D) none of these 
A) central bank (rbi) 
B) sbi 
C) iba 
D) none of these

Question 5

Point out which of the following is not an instrument of fiscal policy:

Accepted Answer

A) an increase in the interest rate 
B) a cut in unemployment compensation 
C) an increase in tobacco taxes 
D) a cut in the marginal rates of irpf 
A) an increase in the interest rate 
B) a cut in unemployment compensation 
C) an increase in tobacco taxes 
D) a cut in the marginal rates of irpf

Question 6

The function of investment spending shifts to the left if:

Accepted Answer

A) the interest rate rises 
B) the interest rate falls 
C) business expectations improve 
D) business expectations get worse 
A) the interest rate rises 
B) the interest rate falls 
C) business expectations improve 
D) business expectations get worse

Question 7

Which of the following is an effect of inflation?

Accepted Answer

A) erosion in purchasing power 
B) affects relative price of goods 
C) increase in inequalities of income 
D) all the above 
A) erosion in purchasing power 
B) affects relative price of goods 
C) increase in inequalities of income 
D) all the above

Question 8

Trade between two countries is called

Accepted Answer

A) Internal trade 
B) Intra-Country trade 
C) Intra-State Trade 
D) International Trade 
A) Internal trade 
B) Intra-Country trade 
C) Intra-State Trade 
D) International Trade

Question 9

The main objective of monetary policy in India is-------:

Accepted Answer

A) growth with stability 
B) reduce poverty and achieve stability 
C) overall monetary stability 
D) none of these 
A) growth with stability 
B) reduce poverty and achieve stability 
C) overall monetary stability 
D) none of these

Question 10

What is Cost-Push inflation?

Accepted Answer

A) increasing money supply 
B) increasing indirect tax 
C) population increase 
D) expenditure increase unnecessarily. 
A) increasing money supply 
B) increasing indirect tax 
C) population increase 
D) expenditure increase unnecessarily.

Question 11

Inflation is the state in which ..............................

Accepted Answer

A) the value of money decreases 
B) the value of money increases 
C) the value of the money increases first and then decreases 
D) the value of money decreases first and increases later 
A) the value of money decreases 
B) the value of money increases 
C) the value of the money increases first and then decreases 
D) the value of money decreases first and increases later

Question 12

Which of the following class will not be negatively affected by the higher inflation?

Accepted Answer

A) the consumer class 
B) the debtor class 
C) pensioner class 
D) business class 
A) the consumer class 
B) the debtor class 
C) pensioner class 
D) business class

Question 13

To increase the money supply, the bank central could:

Accepted Answer

A) cut taxes 
B) purchase bonds in the open-market 
C) encourage people to held more cash (currency in circulation) 
D) increase the government spending 
A) cut taxes 
B) purchase bonds in the open-market 
C) encourage people to held more cash (currency in circulation) 
D) increase the government spending

Question 14

As higher is the MPS

Accepted Answer

A) lower is the multiplier. 
B) higher is the investment spending 
C) higher is the equilibrium income. 
D) all the answers are right 
A) lower is the multiplier. 
B) higher is the investment spending 
C) higher is the equilibrium income. 
D) all the answers are right

Question 15

If RBI wants to increase the credit flow it buys -------:

Accepted Answer

A) government securities 
B) shares and debentures 
C) other local and short-term securities 
D) none of these 
A) government securities 
B) shares and debentures 
C) other local and short-term securities 
D) none of these

Question 16

The variable that connect the market of money and the market of goods via investment spending is:

Accepted Answer

A) the mpc 
B) the interest rate 
C) the mps 
D) the cpi 
A) the mpc 
B) the interest rate 
C) the mps 
D) the cpi

Question 17

The Cash Reserve Ratio is an effective instrument of credit control. Under the RBI Act, 1934 every -------bank has to keep certain minimum cash reserves with RBI:

Accepted Answer

A) public bank 
B) commercial bank 
C) industrial and agricultural banks 
D) none of these 
A) public bank 
B) commercial bank 
C) industrial and agricultural banks 
D) none of these

Question 18

Point out the monetary policy instrument:

Accepted Answer

A) an increase in direct taxes 
B) open-market operations 
C) freezing pensions 
D) a cut in government purchase of goods and services 
A) an increase in direct taxes 
B) open-market operations 
C) freezing pensions 
D) a cut in government purchase of goods and services

An increase in the interest rate1

The government spending multiplier is as higher as:

-------controls the supply of money and bank credit:

Monetary Policy is a regulatory policy by which the -------or monetary authority of a country controls the supply of money, availability of bank credit and cost of money that is the rate of interest:

Point out which of the following is not an instrument of fiscal policy:

The function of investment spending shifts to the left if:

Which of the following is an effect of inflation?

Trade between two countries is called

The main objective of monetary policy in India is-------:

What is Cost-Push inflation?

Inflation is the state in which ..............................

Which of the following class will not be negatively affected by the higher inflation?

To increase the money supply, the bank central could:

As higher is the MPS

If RBI wants to increase the credit flow it buys -------:

The variable that connect the market of money and the market of goods via investment spending is:

The Cash Reserve Ratio is an effective instrument of credit control. Under the RBI Act, 1934 every -------bank has to keep certain minimum cash reserves with RBI:

Point out the monetary policy instrument:

Key Concepts in Macroeconomics and Economic History

National Income and GDP Calculation in India

National Income and Classical Theory of Employment

Economic Concepts and Policies

International Trade Theories and Concepts

Understanding Terms of Trade and International Trade Policies

International Trade Policies and Organizations

International Trade and Economic Policies

Balance of Payment and International Trade

International Trade and Finance

Understanding Foreign Exchange Market and Exchange Rate Systems: Part 1

Understanding Foreign Exchange Market and Exchange Rate Systems: Part 2

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Exam 5: Understanding Inflation, Business Cycles, and Monetary Policy

An increase in the interest rate1

The government spending multiplier is as higher as:

-------controls the supply of money and bank credit:

Monetary Policy is a regulatory policy by which the -------or monetary authority of a country controls the supply of money, availability of bank credit and cost of money that is the rate of interest:

Point out which of the following is not an instrument of fiscal policy:

The function of investment spending shifts to the left if:

Which of the following is an effect of inflation?

Trade between two countries is called

The main objective of monetary policy in India is-------:

What is Cost-Push inflation?

Inflation is the state in which ..............................

Which of the following class will not be negatively affected by the higher inflation?

To increase the money supply, the bank central could:

As higher is the MPS

If RBI wants to increase the credit flow it buys -------:

The variable that connect the market of money and the market of goods via investment spending is:

The Cash Reserve Ratio is an effective instrument of credit control. Under the RBI Act, 1934 every -------bank has to keep certain minimum cash reserves with RBI:

Point out the monetary policy instrument:

Key Concepts in Macroeconomics and Economic History

National Income and GDP Calculation in India

National Income and Classical Theory of Employment

Economic Concepts and Policies

International Trade Theories and Concepts

Understanding Terms of Trade and International Trade Policies

International Trade Policies and Organizations

International Trade and Economic Policies

Balance of Payment and International Trade

International Trade and Finance

Understanding Foreign Exchange Market and Exchange Rate Systems: Part 1

Understanding Foreign Exchange Market and Exchange Rate Systems: Part 2

Filters