Economics Practice MCQ Page 31

Multiple Choice questions for Economics in the sets of 10 each on one page with questions and answers. All sets are useful in the preparation of subject tests for employment or admission.
Question: 1813   Which of the following is not a financial intermediary?
  1. Federal Deposit Insurance Corporation.
  2. Commercial bank.
  3. Saving and loan.
  4. Insurance company.
Question: 1814   If the banking system obtains $100,000 in new deposits.what will total deposits be after the multiplier expansion process if r=0.25?
  1. $25.000.
  2. $125.000.
  3. $300.000.
  4. $400,000.
Question: 1815   Each of the following is one of the main functions of money except
  1. standard of deferred payment.
  2. instrument of credit.
  3. a store of value.
  4. a medium of exchange.
  5. a unit of value.
Question: 1816   A high anticipated of inflation reduces the desirability of money as
  1. a standard of deferred payment.
  2. an instrument of credit.
  3. a store of value.
  4. a medium of exchange.
  5. a unit of value.
Question: 1817   When the terms of a loan specify a specific number of dollars to be repaid ,the dollars is serving as
  1. a standard of deferred payment.
  2. an instrument of credit.
  3. a store of value.
  4. a medium of exchange.
  5. a unit of value.
Question: 1818   The principal disadvantage of commodity money is that
  1. it may not be accepted for transactions.
  2. it is easily debased through inflation by the monetary authority.
  3. the government controls the supply of money
  4. commodity money has a high opportunity cost to society.
  5. all commodity monies are heavy and awkward to transport.
Question: 1819   The principal disadvantage of commodity money is that
  1. it may not be accepted for transactions.
  2. it is easily debased through inflation by the monetary authority.
  3. the government controls the supply of money
  4. commodity money has a high opportunity cost to society.
  5. all commodity monies are heavy and awkward to transport.
Question: 1820   When the silver quarters are driven out of circulation by hoarding so that only less valuable ,bimetallic quarters are used,it is an example of
  1. the law of diminishing returns.
  2. the law of comparative advantage.
  3. Friedman's Law.
  4. Gresham's Law.
  5. hyperinflation.
Question: 1821   As Russia moves toward a market economy,
  1. prices must be lowered to eliminate shortages.
  2. the ruble must serve as the medium of exchange.
  3. increased reliance one central planning will be needed.
  4. it is attempting to create a commodity money standard.
Question: 1822   A bank account that can be accessed by writing a check is called a
  1. demand deposit.
  2. cash deposit.
  3. saving deposit.
  4. automatic deposit.
  5. time deposit.
Question: 1824   The most liquid type of bank account is the
  1. time deposit.
  2. saving deposit.
  3. certificate deposit.
  4. demand deposit.
  5. automatic deposit.
Question: 1825   The key concept of the quantity theory of money is that.
  1. only a commodity -money standard can prevent inflation.
  2. the value of money is determined by the quantity of money in circulation.
  3. V and Q are money fixed in the long run.
  4. inflation can only happen if an economy produces too few goods.

Answers to the questions of Economics on this page

Following list gives the correct choice for the answer of the Economics mcqs.
1813 . A       1814 . D       1815 . B       1816 . C       1817 . A       1818 . D       1819 . D       1820 . D       1821 . B       1822 . A       1824 . D       1825 . B      

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