Which of the following is not the instrument of fiscal policy?

• A) Open market operation
• B) Taxes
• C) Subsidies
• D) Government expenditures

Which of the following is Quantitative credit control?

• A) Direct action
• B) Publicity
• C) Bank rate policy
• D) Consumer credit control

Which of the following is non-economic activity?

• A) Birth rates
• B) Unemployment
• C) Inflation
• D) Economic growth

If government wants to control inflation during boom then it should:

• A) Decrease Taxes
• B) Decrease output
• C) Increase Taxes
• D) Increase public expenditures

Which of the following is correct formula?

• A) L=Lt - Ls
• B) L=Lt +Ls
• C) L=Lt *Ls
• D) L=Lt /Ls

Stagflation represents the relationship between inflation and:

• A) Taxes
• B) Savings
• C) Consumption
• D) Unemployment

Which of the following is the down turn phase of business cycle?

• A) Recession
• B) Depression
• C) Boom
• D) Recovery

Which of the following is correct for equilibrium rate of interest?

• A) Savings are equal to supply of money
• B) Savings are less than investment
• C) Savings are greater than investment
• D) Savings are equal to investment

When LM curve shifts leftward and IS curve remains same then rate of interest in general equilibrium will:

• A) Fall
• B) Rise
• C) None of these
• D) Remain same

Which of the following should government do to remove deflationary gap?

• A) Government expenditures should increase
• B) None of the above
• C) Government expenditures should decrease
• D) Government expenditures should not change

Monetary policy is exercised by:

• A) Commercial banks
• B) Central bank
• C) Provincial government
• D) Federal government

Which of the following should central bank do to control the inflation in the economy?

• A) Central bank should keep same bank rate
• B) None of the above
• C) Central bank should decrease bank rate
• D) Central bank should raise bank rate

Which of the following is the upper phase of business cycle?

• A) Boom
• B) Recovery
• C) Recession
• D) Depression

The situation in which economy is operating at below full employment indicates:

• A) Inflationary gap
• B) Deflationary gap
• C) Full employment
• D) None of the above

The relationship between market rate of interest and market prices of bonds is:

• A) None of these
• B) Negative
• C) Constant
• D) Positive

Which of the following policy is adopted by government?

• A) Fiscal policy
• B) Monetary policy
• C) Central bank policy
• D) Bank rate policy

Stagflation arises from:

• A) Subsidies
• B) Savings
• C) Cost-push inflation
• D) Demand pull inflation

When LM curve shifts rightward and IS curve remains same then rate of interest in general equilibrium will:

• A) None of these
• B) Remain same
• C) Fall
• D) Rise

The situation in which economy is operating at above full employment indicates:

• A) Deflationary gap
• B) Full employment
• C) Inflationary gap
• D) None of the above

Which of the following is the upturn phase of business cycle?

• A) Boom
• B) Recovery
• C) Recession
• D) Depression