Central banks prefer to fix the ____ and accept the resulting _____?

Related Mcqs:

1. Reserve requirements that may be imposed on an economy’s banks by its central bank specify that banks by its central bank specify that banks reserve must be a minimum percentage of them ?

   A. assets
   B. deposits
   C. loans
   D. government bonds

2. If the economy is in the expansionary phase of the business cycle, aggregate demand ____ unemployment ____ inflation ____ payments is likely to move towards ____?

   A. falls; rise; falls; surplus
   B. is static; low; rise; deficit;
   C. falls; falls; falls; surplus
   D. rise; falls; rises; deficit

3. Which function is performed by both commercial banks and central banks ?

   A. Acting as bankers to the government
   B. Advising the government on monetary policy
   C. Dealing in foreign exchange
   D. Fixing the main interest rate

4. In the events of an increase in the international price of oil that encouraged the central bank to accept lower real interest rates, inflation would most likely ?

   A. fall
   B. increase
   C. remain the same
   D. fluctuates

5. Unemployment resulting from imperfect information in the labour market is called ____ unemployment?

   A. Frictional
   B. natural
   C. real-wage
   D. disequilibrium

6. The Organization of Petroleum Exporting Countries (OPEC) is a(n) _________whose members agree to limit output and fix prices?

   A. monopoly
   B. entropy
   C. industry
   D. cartel

7. If a government were to fix a minimum wage for adult workers, economists would predict ?

   A. wages in general would fall as employers tried to hold down costs
   B. fewer young workers would be employed
   C. the costs and prices of firms employing cheap labour would increase
   D. there would be more unemployment

8. Central bank’s rate of lending to commercial banks is called ?

   A. Interest rate
   B. Discount rate
   C. Money rate
   D. Control rate

9. In the absence of international capital controls, central banks set ________ to provide the correct incentive for speculators?

   A. money supply targets
   B. income policy
   C. interest rates
   D. inflation targets

10. “Seigniorage” is a source of revenue for central banks earned from_____________?

    A. Issuance of Debt securities
    B. Issuance of notes and coins
    C. Dollar Reserves
    D. All of above

    Submitted by: Asad Javed