If Pakistan takes part in a war in the Middle East, what will tend to happen to the exchange value of its currency?
Correct answer B. Depreciate
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Macroeconomic Issues and Analysis MCQs
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- Miscellaneous Economics 737
- Basic of Economics 430
- Markets, Efficiency And The Public Interest 167
- Agriculture & Irrigation System of Pakistan 126
- Market 87
- Macroeconomic Issues and Analysis 75
- Money, Interest Rates And Output 73
- Introduction To Economics 70
- Population And Development 62
- Profit Maximizing Under Perfect Competition And Monopoly 56
- Income Inequality 52
- Non-Tariff Trade Barriers 48
- Aggregate Supply, Unemployment And Inflation 45
- Natural Resources and the Environment Toward Sustainable Development 44
- Costs , Supply And Perfect Competition 44
- Human Capital 42
- Labour Market 39
- Monopoly 35
- Long Term Economic Growth 30
- Inflation & Productivity 30
- Regional Trading Arrangements 29
- Characteristics and Institutions of Developing Countries 24
- Oligopoly 23
- Consumer Theory vs. Real Consumers 20
- Applied Microeconomics 20
- Alternative Theories Of The Firm 20
- Public Goods 20
- Balance of Payments, Aid and Foreign Investment 19
- Prices, Wages & Taxes 19
- Comparative GDP 19
- Budget Deficits And The Trade Balance 18
- Macroeconomic Policy Tools 18
- Asymmetric Information 17
- Application of Economics 16
- Production Factors 16
- Monopoly & Competition 15
- Capital Formation, Investment Choice, Information Technology, And Technical Progress 15
- Monetary, Fiscal And Incomes Policy, And Inflation 15
- Average And Total Cost 14
- Poverty, Malnutrition, And Income Inequality 12
- Monetary Union 10
If incomes in Pakistan grow faster than in most other countries, what will tend to happen to the exchange value of its currency?
Correct answer A. Depreciate
If a large car importer in Pakistan wants to bring in many cars, what will tend to happen to the exchange value of the Pakistani rupee?
Correct answer A. Depreciate
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At the peak of the business cycle, what is the likely position of aggregate demand, unemployment and inflation, and in which direction will the current account tend to move?
Correct answer C. Is static; low; rises; deficit
When the $/£ exchange rate rises, what happens to the pound, and what happens when it falls?
Correct answer B. Appreciates, depreciates
Starting from internal and external balance, what will a fall in aggregate demand do to the current account?
Correct answer D. Surplus
When capital mobility is perfect, what tends to offset differences in interest rates between countries?
Correct answer C. Expected exchange rate changes
With fixed exchange rates and no private capital flows, what will the central bank do to correct a balance of payments deficit?
Correct answer C. Sell foreign exchange, buy domestic currency
Without international capital controls, what do central banks set in order to give speculators the right incentive?
Correct answer A. Interest rates
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The competitive gain from a devaluation is likely to be offset by which two developments?
Correct answer C. Higher import prices, higher wage increases
In the short run, what mainly determines the level of floating exchange rates?
Correct answer D. Speculation
How do floating exchange rates typically behave in the short run?
Correct answer B. Volatile
Why is fiscal policy weak under floating exchange rates?
Correct answer B. Fiscal expansion crowds out exports
What were the main features of the European Monetary System?
Correct answer D. All of the above
The Single European Act committed ____ governments to a ____ by 1992. Which pair completes the sentence?
Correct answer C. European Union, single market
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A monetary union involves which three features?
Correct answer D. Permanently fixed exchange rates, free capital movements, a single interest rate
Under the Maastricht criteria for joining EMU, what were applicants required to have?
Correct answer E. All of the above
Within Economic and Monetary Union (EMU), how can a member country’s competitiveness change?
Correct answer D. Domestic wage and price adjustment
What is meant by an objective in economic policy?
Correct answer D. A target
Which of these does the government NOT control directly?
Correct answer B. Firms' investment decisions