Economics MCQs For Lectureship CSS PMS And NTS Part IV

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Economics MCQs For Lectureship CSS PMS And NTS Part IV

1 What is NI = NE?

An Identity

2 What is Per capita income?

Income per head

3 What we get when indirect taxes are deducted from NNP and subsidies are added?

National Income

4 Why transfer payments are not included in national income?

Double counting would result

5 How to determine the correct level of GDP?

Add up the values of goods and services during one year

6 When real national income increases?

Quantity of goods and services increases

7 Construction of house is

An investment

8 Unemployment allowances paid by government is considered as transfer of payments

Transfer of payments

9 GDP is always greater than what?


10 What are the four factor payments?

Wages, rent, interest and profits

11 What are social security payments?

Transfer payment

12 What will happen to private savings if government increases taxes?


13 On whom corporate tax is levied?

Big companies

14 What we get if we deduct direct tax from personal income?

Disposable income

15 Which is the largest part of national income?


16 What does transfer payments means?

The payment without work

17 Direct taxes are not part of

Disposable Personal Income

18 By how many methods national income can be measured?

Three (3)

19 What is the difference between GDP and GNP?

GNP = GDP + net income from abroad

20  To get NNP, what we should deduct from GNP?



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21  During GDP measurement, to avoid double counting, what economists do?

Calculate value added at each stage of production

22  How to find NNP from GNp?

By deducting depreciation allowance

23 What is undistributed profit?

Income earned but not received

24 What is GNP?

The market value of all goods and services produced in an economy

25 In terms of national income accounts, what multiple counting refers to?

Counting currently produced goods more than one time

26 What is net investment?

Gross investment minus capital consumption allowance

27 Personal Income is equivalent to what?

NI plus unearned receipts minus earning not received

28 What are net exports?

Total exports minus total imports

29 What is national income?

Total income earned while producing the national product

30 Traffic fines are included in what?

Personal Income but not in disposable Personal Income

31 National income is a measure of what?

Payments made to factors of production

32 When a country is considered poor?

Less production of goods per capita

33 A country is also considered poor with

Less GNP per capita

34 What relation do Consumption and National Income have?

A functional relation

35 What is Macroeconomics?

Aggregate economic activity

36 What is a closed economy?

No international trade is concluded

37 When one or more persons are living in a joint family, in economics it called


38 What is the largest type of income in Pakistan?

Compensation of employees

39 Can you define an open economy?

Interact with other economies

40 On whom corporate tax is levied?

Joint stock companies

41 Where does the largest part of national income go?


42 What does transfer payment means?

The payment without work

43 In disposable income direct tax are

Not included

44 Is it true that National Income = National Expenditure?


45 Is it true that NI = NNP – Indirect taxes?


46 What is deducted from GNP to get NNP


47   To get GNP what should be added to GDP?

Net income from abroad

48 What is the  position of National Income in equilibrium?

S = I

49 What happens if saving exceeds investment?

National income falls

50 Consumer goods are those which are

Directly used by the people


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51 What Circular flow income includes?

Income and expenditure

52 What does the National income of a country not include?

Illegal and unreported income

53 Persons having joint family budget, in economics they are called


54 At equilibrium level of national income, saving is equal to what?


55 A Rise in exports may case a rise in

National Income

56 What is Marginal propensity to consume?

A ratio of additional income consumed

57 What is aggregate demand?

Aggregate expenditure

58 What is MPC?

Change in consumption divided by change in income

59 A Coin of Rupee is an example of

Token money

60 Which kind of cheque cash cannot be drawn directly from the bank?

Cross cheque

61 It is necessary that money material should be


62 In Pakistan, what is money of account?


63 What is barter system?

If no money is used to exchange good

64 What does Convertible money means?

Government can give gold against it

65 Money that is used as an official medium of exchange, what is it called?

Legal money

66 How can the government control inflation?

Increasing supply of goods

67 The Government of Pakistan issues currency on which basis?

Demand for money in the country

68 What type of relation does quantity of money has with supply of money?


69 What does Commercial banks create?

Credit money

70 A Cheque is

Not a money

71 What is the most important feature of money?

General acceptability

72 How State Bank can change?

Money supply

73 How the supply of money in a country can be increased?

The purchased of bonds by State Bank  

74 When the use of paper money started?

200 years ago

75 Which major property paper money does not have?


76 Which function of money a saving account in a bank represents?

Store of value

77 Who implement monetary policy?

Central Bank of a country

78 What property a money must have?

Readily acceptable

79 Savings can be promoted by

Increase in personal income

80 What is a Treasury Bill?

A document used for short term loan to the government

81 What does speculative demand for money depends on?

Rate of interest

82 What will happen if money supply in a country decreases?

Prices will fall

83 In the equation MV = PY,  what is V?

Velocity of the circulation of money

84 In the equation MV = PY, What is M?

Money supply

85 According to Keynes, how many motive are there for holding money?

Three (3)

86 What Quantity Theory of Money explains?

Value of money depends upon quantity of money

87 Does Cross cheque has a cross (X) sign?

No it does not have a cross sign

88 What are types of Inflation?

Demand Pull and Cost Push

89 What does Liquidity of a monetary asset means?

Ready acceptability of monetary asset

90 What does Barter means?

Trade without the use of money

91 With reference to currency system of a country, what does token money means?

The money which has higher face value

92 The paper money in Pakistan is


93 The characteristic of liquidity belongs to

Good money

94 What is Credit money?

A kind of money

95 What happened to purchasing power of money during deflation?


96 What is Velocity of circulation of money?

The number of times a unit of money changes hand annually

97 Who gave the equation of exchange PT = MV?


98 In Pakistan the value of money is determined by

General price level

99 With the fall of money value, who gets more benefit?


100 If the quantity of money is doubled then according to Quantity theory, what will be the value of money?




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