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McqMate
Chapters
1. |
Speculative demand for money depends upon: |
A. | Income |
B. | Investment |
C. | Rate of interest |
D. | Central bank |
Answer» C. Rate of interest |
2. |
If money supply in a country decrease: |
A. | Prices will rise |
B. | Prices will fall |
C. | Rate of interest falls |
D. | (b) and (c) of above |
Answer» B. Prices will fall |
3. |
In the equation MV = PY, V represents: |
A. | Value of money |
B. | Velocity of circulation of money |
C. | Variation of nation income |
D. | All of the above |
Answer» B. Velocity of circulation of money |
4. |
In the equation MV = PY, M represents: |
A. | Money supply |
B. | Money demand |
C. | Maximum output |
D. | Minimum output |
Answer» A. Money supply |
5. |
According to Keynes, motives for holding money are: |
A. | Two |
B. | Three |
C. | Four |
D. | Five |
Answer» B. Three |
6. |
Quantity Theory of Money explains that: |
A. | Value of money depends upon quantity of money |
B. | Rate of interest depends upon quantity of money |
C. | Quantity of investment depends upon quantity of money |
D. | Supply of money depends upon quantity of money |
Answer» A. Value of money depends upon quantity of money |
7. |
Cross cheque has a cross sign (X) in the: |
A. | Right side upper corner |
B. | Right side lower corner |
C. | Left side upper corner |
D. | It does not have cross sign (X) |
Answer» D. It does not have cross sign (X) |
8. |
Cross cheque means: |
A. | It has been cancelled |
B. | Cash cannot be directly drawn from the bank |
C. | It has two lines drawn in left upper corner |
D. | (b) and (c) of above |
Answer» D. (b) and (c) of above |
9. |
Purchasing power of money during deflation is: |
A. | Reduced |
B. | Increased |
C. | Constant |
D. | Fluctuating |
Answer» B. Increased |
10. |
Velocity of circulation of money means the number of times a unit of money |
A. | Changes hands daily |
B. | Changes hands monthly |
C. | Changes hands annually |
D. | Changes purchasing power |
Answer» C. Changes hands annually |
11. |
The equation of exchange PT = MV was given by: |
A. | Fisher |
B. | Crowther |
C. | Kuznets |
D. | Keynes |
Answer» A. Fisher |
12. |
When value of money falls, they benefit more: |
A. | Farmers |
B. | Industrialist |
C. | Lenders |
D. | Debtors |
Answer» D. Debtors |
13. |
When the nation's money supply is Rs. 1200 billion and GDP is Rs. 4800 billion, velocity of circulation money is: |
A. | 0.25 |
B. | 4 |
C. | 0.4 |
D. | 4 billion rupees |
Answer» B. 4 |
14. |
Which one is equation of exchange? |
A. | PT = MV |
B. | PV = MT |
C. | PM = TV |
D. | None of these |
Answer» A. PT = MV |
15. |
Inflation can be controlled by applying: |
A. | Monetary and fiscal policies |
B. | Monetary and Labour policy |
C. | Fiscal and commercial policies |
D. | All of the above |
Answer» A. Monetary and fiscal policies |
16. |
Inflation is a situation when: |
A. | Prices of some goods rise |
B. | General price level rises continuously |
C. | Prices double every year |
D. | Prices rise and fall |
Answer» B. General price level rises continuously |
17. |
Under normal circumstances, the velocity of circulation of money in a country is: |
A. | 100% |
B. | Negative |
C. | Less than 10 |
D. | Zero |
Answer» C. Less than 10 |
18. |
According to Keynes, demand for money is affected by: |
A. | Income |
B. | Rate of interest |
C. | Literacy rate |
D. | Both (a) & (b) |
Answer» D. Both (a) & (b) |
19. |
During inflation: |
A. | Lenders lose, borrowers gain |
B. | Borrowers lose, lenders gain |
C. | Borrowers and lenders both lose |
D. | All sections of the society gain |
Answer» A. Lenders lose, borrowers gain |
20. |
The quantity demanded of money rises: |
A. | As the interest rises |
B. | As the interest rate falls |
C. | As the supply of money falls |
D. | As the number of banks rises |
Answer» B. As the interest rate falls |
21. |
Which people are most likely to gain during inflation? |
A. | Those living on pension |
B. | Those living on their savings |
C. | Those who are repaying borrowed money |
D. | Those who have lent money |
Answer» C. Those who are repaying borrowed money |
22. |
If quantity of money increases 100%, other things remaining constant, value of money changes by: |
A. | Increases by 100% |
B. | Decreases by 100% |
C. | Decreases by 200% |
D. | Does not change |
Answer» B. Decreases by 100% |
23. |
For the economy, prices are beneficial: |
A. | Falling slowly |
B. | Rising slowly |
C. | Rising fast |
D. | Falling fast |
Answer» B. Rising slowly |
24. |
Value of money means: |
A. | Gold purchased by money |
B. | General purchasing power of money |
C. | Importance of money |
D. | Demand for money |
Answer» B. General purchasing power of money |
25. |
Value of money and supply of money are related: |
A. | Inversely |
B. | Directly |
C. | Govt. law |
D. | Are not related |
Answer» A. Inversely |
26. |
They are not affected badly by rising prices: |
A. | Salaried persons |
B. | Businessmen |
C. | Debtors |
D. | Importers |
Answer» B. Businessmen |
27. |
Inflation: |
A. | Makes distribution of income equal |
B. | Makes distribution of income unequal |
C. | Has no effect on distribution of income |
D. | Affects only industrial sector |
Answer» B. Makes distribution of income unequal |
28. |
It is assumption of quantity theory of money: |
A. | Quantity of traded goods increases |
B. | Velocity of circulation of money constant |
C. | Govt. imposes new taxes |
D. | (a) and (b) of the above |
Answer» B. Velocity of circulation of money constant |
29. |
If we put this letter in the blank space, we get quantity theory of money PY = M |
A. | S |
B. | T |
C. | V |
D. | A |
Answer» C. V |
30. |
In the equation PY = MV showing quantity theory of money. Y represents: |
A. | Year of measurement of national income |
B. | National income |
C. | Tax revenue of the govt |
D. | (a) and (c) of above |
Answer» B. National income |
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