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Economics Mcqs 4423 MCQs [All-Courses]

Economics MCQs cover fundamental concepts of microeconomics and macroeconomics, including demand and supply, inflation, national income, and economic policies.
This section is designed to strengthen analytical skills and conceptual understanding for competitive examinations.
Highly useful for PPSC, FPSC, NTS, OTS, KPPSC, and other testing services preparation.

Suppose there occurs an increase in the Canadian demand for Japanese computers This results in a (an) ?

A increase in the demand for yen

B decrease in the demand for yen

C increase in the supply of yen

D decrease in the Supply of yen

Review Detailed Answer

Correct Answer: increase in the demand for yen

Given the foreign currency market for the Swiss franc, the supply of franc slopes upward, because as the dollar price of the franc rises ?

A America’s demand for Swiss merchandise rises

B America’s demand for Swiss merchandise falls

C Switzerland’s demand for American merchandise rises

D Switzerland’s demand for American merchandise falls

Review Detailed Answer

Correct Answer: Switzerland’s demand for American merchandise rises

Which financial instrument provides a buyer the right to purchase or sell a fixed amount of currency at a prearranged price, within a few days to a couple of years ?

A letter a credit

B foreign currency option

C cable transfer

D bill of exchange

Review Detailed Answer

Correct Answer: foreign currency option

A depreciation of the dollar will have its most pronounced impact on imports if the demand for imports is ?

A constant

B inelastic

C elastic

D Unitary elastic

Review Detailed Answer

Correct Answer: elastic

In the early eighties, the Federal Reserve pursed a tight monetary policy. All else being equal. the impact of that policy was to interest rates in the United States relative to those in Europe and cause the dollar to _______ against European currencies?

A decrease; depreciate

B decrease; appreciate

C increase; depreciate

D increase; appreciate

Review Detailed Answer

Correct Answer: increase; appreciate

The supply of foreign currency tends to be ?

A upward sloping

B downward sloping

C vertical

D any of the above

Review Detailed Answer

Correct Answer: upward sloping

The J-curve effect refers to the observation that ?

A GDP usually decreases before it increases after a currency depreciation

B the trade balance usually gets worse before it improves after a currency depreciation

C the trade balance usually gets better before it gets worse after a currency appreciation

D GDP usually decreases before it increases after a currency appreciation

Review Detailed Answer

Correct Answer: the trade balance usually gets worse before it improves after a currency depreciation

If a nation’s interest rates are relatively low compared to those of other countries then the exchange value of its currency will tend to ?

A depreciate under a system of fixed exchange rates

B depreciate under a system of floating exchange rates

C appreciate under a system of floating exchange rates

D appreciate under a system of floating fixed rates

Review Detailed Answer

Correct Answer: depreciate under a system of floating exchange rates

The theory of international exchange that holds that exchange rates adjust to offset differences in countries inflation rates in the ?

A price feedback theory

B trade feedback theory

C J-curve theory

D purchasing power parity theory

Review Detailed Answer

Correct Answer: purchasing power parity theory

The fall in value of one currency relative to another is ?

A a depreciation of a currency

B a strengthening of a currency

C a floating of a currency

D an appreciation of a currency

Review Detailed Answer

Correct Answer: a depreciation of a currency

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Economics Mcqs 4423 MCQs [All-Courses]

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All Topics 4423

Suppose there occurs an increase in the Canadian demand for Japanese computers This results in a (an) ?

Given the foreign currency market for the Swiss franc, the supply of franc slopes upward, because as the dollar price of the franc rises ?

Which financial instrument provides a buyer the right to purchase or sell a fixed amount of currency at a prearranged price, within a few days to a couple of years ?

A depreciation of the dollar will have its most pronounced impact on imports if the demand for imports is ?

In the early eighties, the Federal Reserve pursed a tight monetary policy. All else being equal. the impact of that policy was to interest rates in the United States relative to those in Europe and cause the dollar to _______ against European currencies?

The supply of foreign currency tends to be ?

The J-curve effect refers to the observation that ?

If a nation’s interest rates are relatively low compared to those of other countries then the exchange value of its currency will tend to ?

The theory of international exchange that holds that exchange rates adjust to offset differences in countries inflation rates in the ?

The fall in value of one currency relative to another is ?