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Fiscal and Monetary Policy

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Fiscal and Monetary Policy

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About this activity

Economics single topic MCQ

Created by

Savio Costa
Savio Costa
Bangladesh

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Fiscal and Monetary Policy
 

Fiscal and Monetary PolicyOnline version

Economics single topic MCQ

by Savio Costa
1

Identify the type of fiscal policy used when a government increases public sector wages during an economic downturn.

2

Analyse the likely impact of a rise in income tax on consumer spending.

3

Which of the following represents a contractionary fiscal measure?

4

Evaluate the effectiveness of expansionary fiscal policy in reducing cyclical unemployment.

5

During a boom, a government decides to reduce its budget deficit. What type of fiscal stance is this?

6

State the likely effect of a central bank reducing interest rates.

7

Which of the following is a contractionary monetary policy tool?

8

Assess the impact of expansionary monetary policy on inflation.

9

A central bank sells government securities to commercial banks. What is the intended outcome?

10

Explain why a central bank might raise interest rates during a period of high inflation.

11

A government increases spending on education while maintaining current tax rates. What is the likely fiscal effect?

12

Evaluate the impact of contractionary monetary policy on business investment.

13

Which combination of policies is most appropriate during a recession?

14

A government reduces both spending and taxation. What is the likely net effect?

15

Analyse the effect of expansionary fiscal policy on aggregate demand.

16

A rise in government borrowing leads to higher interest rates, reducing private investment. What is this effect called?

17

If interest rates are low but investment remains stagnant, this may indicate:

18

Which of the following is an example of an automatic stabilizer?

19

A country raises interest rates to attract foreign investment. What is the likely currency effect?

20

Which policy is most effective for short-term demand management?

 
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