Economics/Economics Money and Value of Money Sample Test,Sample questions

Question:
  Anything used as money must be:

1.Fixed in value

2.Fixed in supply

3.Legal tender

4.Readily acceptable


Question:
  Government securities:

1.Mean currency

2. Are near money

3.Are bought and sold on stock exchange market

4.(b) and (c) of above


Question:
  If money supply in a country decreases:

1. Prices will rise

2.Prices will fall

3.Rate of interest falls

4.(b) and (c) of above


Question:
  Inflation is a situation when :

1.Prices of some goods rise

2. General price level rises continuously

3.Prices double every year

4.Prices rise and fall


Question:
  It implements monetary policy of the country:

1.Central bank

2.Commercial banks

3.Specialised bank

4.Finance department


Question:
  It is a kind of money:

1.Credit money

2.Discredit money

3.Trust money

4.False money


Question:
  Liquidity of a monetary asset means:

1.Velocity of circulation of money

2.Easy availability of oney

3. Ready acceptability of monetary asset

4.The monetary asset has lost it value


Question:
  Purchasing power of money during deflation is:

1.Reduced

2.Increased

3.Constant

4.Fluctuating


Question:
  Speculative demand for money depends upon:

1.Income

2.Investment

3.Rate of interest

4.Central bank


Question:
  Which does NOT represent a method of payment?

1.Cheque

2.Saving certificate

3.Currency note

4. Bill of exchange


Question:
  Which of the following increases money supply in the country?

1.Purchase of bonds by State Bank

2. Sale of bonds by State Bank

3.Increase in discount rate

4.Decrease in taxes


Question:
  Which one is equation of exchange?

1.PT = MV

2.PV = MT

3.PM = TV

4.None of these


Question:
 A student records her income and spending for past month she uses the funtion of money

1.Medium of exchange

2.Standard of deferred payments

3.Store of value

4.Unit of account


Question:
 Banks discount it and advance loans:

1.Draft

2.Bill of exchange

3.Pay order

4.Gold


Question:
 Government of Pakistan issues currency on the basis of:

1.Availability of gold in the country

2.Availability of dollars in the country

3.Demand for money in the country

4.Tax collection


Question:
 If no money is used to exchange goods it is called:

1.Barter

2.Currency

3.Black market

4.Free trade


Question:
 If quantity of money increases 100% other things remaining constant value of money changes by:

1.Increases by 100%

2.Decreases by 100%

3. Decreases by 200%

4.Does not change


Question:
 In Pakistan money of account is:

1.Paisa

2.Rupee

3.Gold

4.Dollar


Question:
 In the equation MV = PY M represents:

1.Money supply

2.Money demand

3.Maximum output

4.Minimum output


Question:
 In the equation MV = PY V represents:

1.Value of money

2.Velocity of circulation of money

3.Variation of nation income

4.All of the above


Question:
 Inflation can be controlled by applying:

1.Monetary and fiscal policies

2.Monetary and labour policy

3.Fiscal and commercial policies

4.All of the above


Question:
 It can change money supply:

1.National Assembly

2.Supreme Court

3.Government

4.State Bank


Question:
 It is included in kinds of money:

1.Legal money

2.Credit money

3.Token money

4.All of the above


Question:
 Paper money in Pakistan is:

1.Convertible

2.Inconvertible

3.Linked to gold

4.None of the above


Question:
 The govt. can control inflation by:

1. Increasing demand for goods

2.Increasing supply of goods

3. Increasing money supply

4.Decreasing taxes


Question:
 Velocity of circulation of money means the number of times a unit of money

1.Changes hands daily

2.Changes hands monthly

3.Changes hands annually

4. Changes purchasing power


Question:
 When value of money falls they benefit more:

1.Farmers

2.Industrialist

3.Lenders

4.Debtors


Question:
 Which people are most likely to gain during inflation?

1.Those living on pension

2.Those living on their savings

3.Those who are repaying borrowed money

4.Those who have lent money


Question:
 Which property paper money does NOT Possess

1.Acceptability

2.Divisibility

3.Durability

4.Portability


Question:
A saving account in a bank represents the function of money:

1. A measure of value

2.A medium of exchange

3.A standard for deferred payments

4.Store of value


Question:
According to Keynes demand for money is affected by:

1. Income

2.Rate of interest

3.Literacy rate

4.Both (a) & (b)


Question:
Accourding to Keynes motives for holding money are:

1.Two

2.Three

3.Four

4.Five


Question:
Barter has the defect:

1.Goods exchanged are of inferior quality

2.Goods cannot be exchanged for services

3. Lack of common measure of value

4.None of the above


Question:
Barter means:

1.Trade through metallic money only

2.Trade of goods only excluding services

3.Trade of very low value goods

4.Trade without use of money


Question:
Cash cannot be directly drawn from a bank against:

1.Cross cheque

2.Order cheque

3.Bearer cheque

4.Traveller cheque


Question:
Cheque is:

1.Legal money

2.Credit money

3.Paper money

4.Not money


Question:
Commercial banks create:

1.Credit money

2.Token money

3.Legal money

4.Do not create money


Question:
Convertible money means:

1.It can buy goods

2.. Govt. can give gold against it

3.Illegal money

4.Low value money


Question:
Cross cheque has a cross sign (X) in the:

1.Right side upper corner

2. Right side lower corner

3.Left side upper corner

4. It does not have cross sign (X)


Question:
Cross cheque means:

1.It has been cancelled

2. Cash cannot be directly drawn from the bank

3.It has two lines drawn in left upper corner

4.(b) and (c) of above


Question:
Cross cheque:

1.Is issued only by a business firm

2. Is not accepted by banks

3. Ensures immediate payment of cash to the holder

4.None of the above


Question:
During inflation:

1.Lenders lose borrowers gain

2.Borrowers lose lenders gain

3.Borrowers and lenders both lose

4.All sections of the society gain


Question:
In Pakistan in the year 2007-08 money supply was about

1.Rs. 3400 million

2.Rs. 3400 billion

3. Rs. 3400 trillion

4.Uncountable


Question:
In payment of debt people can use this kind of money:

1.Legal money

2.Credit money

3. Real money

4.(a) and (b) of the above


Question:
It is the medium of exchange:

1.Black money

2.Near money

3.Currency

4.Foreign exchange


Question:
It is true to say about kinds of inflation:

1.Demand pull and cost push inflation

2.Demand pull and cost push industry

3.Demand pull and income pull inflation

4.None of the above


Question:
Legal money is called so because:

1.The buyer must pay in that money

2.Can be converted into gold

3.Sellers do not accept any other money

4.It is official medium of exchange


Question:
Money material should be:

1.Abundant

2.Scarce

3.Beautiful

4.Heavy


Question:
Paper money came into use:

1.100 years ago

2.200 years ago

3. 1000 years ago

4.2000 years ago


Question:
Paper money is called fiat money because

1. It is issued with authority of government

2. It is convertible into gold

3.It can be easily printed

4.It is light weight


Question:
Quantity of money has relation with value of money:

1.Direct

2.Indirect

3.Inverse

4.No relation


Question:
Quantity Theory of Money explains that:

1.Value of money depends upon quantity of money

2. Rate of interest depends upon quantity of money

3.Quantity of investment depends upon quantity of money

4.Supply of money depends upon quantity of money


Question:
Rupee is a coin:

1.Full value

2.Token money

3.Credit money

4.Convertible


Question:
Ten-rupee note is:

1.Token money

2.Credit money

3.Legal money

4.(a) and (c) of above


Question:
The equation of exchange PT = MV was given by:

1.Fisher

2.Crowther

3.Kuznet

4.Keynes


Question:
The most important feature of money:

1.General acceptability

2.Convertibility into gold

3.Store of value

4.Medium of exchange


Question:
The quantity demanded of money rises:

1. As the interest rises

2.As the interest rate falls

3.As the supply of money falls

4.As the number of banks rises


Question:
This is a characteristic of good money:

1. High intrinsic value

2.Liquidity

3.Attractive design

4.Easy to duplicate


Question:
This is NOT money

1.Currency

2.Prize bond

3.Demand deposit in a bank

4.Coins


Question:
Treasury Bill is a document used for:

1.A short-term loan to the exporter

2.A long-term loan to the government

3.A short-term loan to the government

4.A short-term loan to a govt. employee


Question:
Under normal circumstances the velocity of circulation of money in a country is:

1.100%

2.Negative

3.Less than 10

4.Zero


Question:
Value of money in Pakistan is determined by:

1.Govt. of Pakistan

2.State Bank

3.General price level

4.Value of doller


Question:
What will promote savings?

1.Increase in credit facilities

2.Increase in taxation

3. Increase in personal incomes

4.Rising prices


Question:
Which is money:

1.Check

2.Credit card

3.Currency

4.Prize bond


Question:
Which is NOT a desirable characteristic of money?

1.Portable

2.Uniform

3.Easily recognised

4.Easily duplicated


Question:
Which is not the function of money:

1.Make demand and supply equal

2.Store of value

3.Medium of exchange

4.Measure of value


Question:
Which is the characteristic of a good money:

1.Has good design

2.Has high value

3.Has a fixed value in gold

4.Is readily accepted by people


Question:
Which property the paper money does not possess:

1.Acceptability

2.Divisibility

3.Duability

4.Portability


Question:
With reference to currency system of a country token money means:

1.Token tax

2.The money which has no purchasing power

3.The money which has higher face value

4.Advance payment to purchase something


More MCQS

  1. Class 9th Economics
  2. Class 10th Economics
  3. Economics Development
  4. Social Economics -Development
  5. Sectors of Indian Economy
  6. Indian Economy for Competitive Examinations
  7. Economics Bank System MCQS
  8. Economics National Income MCQS Set-1
  9. Economics National Income MCQS Set-2
  10. Economic Growth and Development
  11. Economics Money Banking and International Trade
  12. Economics Nature and Scope of Economics
  13. Economics Production and Production Function
  14. Economic Development and Planning
  15. Economics Balance of Payments
  16. Economics Central Bank
  17. Economics Equilibrium Of National Income
  18. Economics International Economic Organisations
  19. Economics Business and Finance
  20. Economics Economics and Commercial Geography
  21. Economics International Economic Organisations set-2
  22. Economics Money and Value of Money
  23. Economics Demand and Supply Set-1
  24. Economics Economy of Pakistan
  25. Economics Public Finance
  26. Economics Scale Of Production and Laws of Returns
  27. Economics Transport Communication and Human Resources
  28. Economics Wages Rent Interest and Profit
  29. Economics Demand and Supply Set-2
  30. Economics Great Economists and Their Work Set-1
  31. Economics Great Economists and Their Work Set-2
  32. Economics Market and Revenue Curves
  33. Economics Market Equilibrium
  34. Economics National Income Accounting Set-1
  35. Economics World Economy
  36. Economics National Income Accounting Set-2
  37. MCQ Indian Economy Set 5
  38. MCQ Indian Economy Set 1
  39. MCQ Indian Economy Set 2
  40. MCQ Indian Economy Set 3
  41. MCQ Indian Economy Set 4
  42. Indian Economy MCQs Part 1
  43. Indian Economy MCQs Part 2
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