Money and Inflation Generix Content - Money and Inflation
HOME

EXAMS

JAMB

WAEC

CONTENTS

SIGN IN

JOIN NOW
"Money and Inflation" question number distribution across years
loading...
Search "Money and Inflation" on the following sites online
 
Economics index on skoool nigeria
 
JAMB questions for "Economics :: Money and Inflation"
Q1
A decrease in aggregate spending in an economy will ultimately lead to
A
boom
B
deflation
C
inflation
D
recession
E
Q2
The velocity of money is represented a s
A
money supply / real GDP
B
real GDP / money supply
C
nominal GDP/ money supply
D
real GDP / nominal GDP
E
Q3
If the increase in the price of yams is used to estimate the inflation rate, this is an example of
A
deductive reasoning
B
inductive reasoning
C
normative reasoning
D
positive reasoning
E
Q4

The theoretical relationship between money supply and price is weakened by changes in the

A

money supply

B

general price level

C

velocity of money

D

interest rate

E
Q5

The high rate of inflation in Nigeria can be attributed to

A

increasing cost of production

B

the appreciation of the naira

C

decreasing cost of production

D

high capacity utilization

E
Q6
Contractionary monetary policy is used to
A
control inflation
B
bridge the deflationary gap
C
expand the output level
D
deregulate the economy
E
Q7
A persistent rise in the prices of inputs will lead to
A
cost-push inflation
B
demand-pull inflation
C
stagflation
D
hyperinflation
E
Q8
One way of controlling deflation is by
A
decreasing wages
B
deficit financing
C
contractionary monetary policy
D
rigid fiscal policy
E
Q9
The exchange rate determined by market forces is known as
A
floating exchange rate
B
pegged exchange rate
C
fixed exchange rate
D
dual exchange rate
E
Q10
Idle cash balances are held for
A
planned purchases
B
the purchase of bonds
C
the purchase of shares
D
unplanned purchases
E
Q11
Above full employment level, an expansionary monetary policy will lead to a
A
fall in aggregate demand
B
decrease in aggregate supply
C
fall in the inflation rate
D
rise in the inflation rate
E
Q12
The factor responsible for the current inflationary pressures in Nigeria is the
A
exchange rate depreciation
B
increase in exports
C
low per capital income
D
budget surplus
E
Q13
One of the causes of the present high rate of inflation in Nigeria is
A
increasing factor costs
B
exchange rate appreciation
C
increasing budget surplus
D
high capacity utilization
E
Q14
The excess of aggregate expenditure over full employment level of output id referred to as
A
GNP gap
B
deflationary gap
C
recessionary gap
D
inflationary gap
E
Q15
Inflation that is usually associated with periods of trade boom is
A
creeping inflation
B
cost-push inflation
C
stag inflation
D
demand-pull inflation
E
Q16
The monetary control instrument most effectively used by the Central bank of Nigeria is the
A
open market operations
B
margin requirement
C
reverse ratio
D
discount rate
E
Q17
If Nigeria's composite price index in 1999 was 140.03% and 144.05% in 200, the rate of inflation in 2000 was
A
1.03%
B
4.02%
C
2.10%
D
2.06%
E
Q18
The term 'Near money' is best described as
A
a financial instrument that is readily convertible to cash
B
government financial instrument that is convertible to cash
C
time deposits with low interest rates
D
a financial asset that is convertible to cash
E
Q19
Excess demand inflation can be controlled through
A
contractionary trade policy
B
expansionary monetary policy
C
contractionary fiscal policy
D
expansionary fiscal policy
E
Q20
Creeping inflation implies that there is a
A
rapid but not permanent increase in the general price level
B
gentle but not permanent increase in the general price level
C
rapid and persistent increase in the general price level
D
gentle and persistent increase in the general price level
E
Q21
Money may not be accepted as a store of value if
A
its value is unstable
B
it is easily transferable
C
its value is stable
D
it is easily divisible
E
Q22
If the United Kingdom buys gold for 60 pounds an ounce and Nigeria buys the same ounce for N500, what will be United Kingdom's exchange rate with Nigeria?
A
0.12 pounds = N1.00
B
0.11 pounds = N1.00
C
0.06 pounds = N1.00
D
0.05 pounds = N1.00
E
Q23
An increase in money supply, other things being equal, will
A
increase money demand
B
reduce income
C
ensure trade balance
D
lower interest rates
E
Q24
One of the functions of money is that, it helps
A
detect fraud in matters of exchange
B
postpone payments without loss of count
C
store information about the intrinsic benefits of an item
D
record information about the valuation of an item
E
Q25
People hold money for
A
charity
B
safe keeping
C
profit making
D
speculative purposes
E
Q26
Inflation which is caused mainly by increases in the prices of factors of production is described as
A
cost-push inflation
B
demand-pull inflation
C
crawling inflation
D
spiral inflation
E
Q27
The relationship between the value of money and the price level is
A
direct
B
unpredictable
C
diverse
D
inverse
E
Q28
If a government wants to reduce the level of inflation, it will
A
run a budget surplus
B
run a budget deficit
C
run a balanced budget
D
borrow more money
E
Q29
Which of the following is true about the value of money?
A
It varies inversely with the price level
B
It varies directly with the price level
C
It depreciates in the period of deflation
D
It is not affected by the price level
E
Q30
The most important attribute of money is
A
homogeneity
B
relative scarcity
C
divisibility
D
general acceptability
E
Q31
Which of the following is inflationary?
A
An increase in taxation
B
An increase in savings
C
A decrease in money supply
D
An increase in government expenditure
E
Q32
Increase in both the legal reservation and discount rate has the effect of
A
increasing the quantity of money in circulation
B
decreasing the quantity of money in circulation
C
the value of money varies inversely with the price level
D
decreasing the value of money
E
Q33
Inflation in he Nigeria economy may be fueled by increase in
A
the dollar price of crude oil
B
the sale of company shares
C
government expenditure
D
sale of government bonds
E
Q34
Gresham's law in economics shows that
A
good money drives out bad money
B
bad money drives out good money
C
the value of money varies inversely with the price level
D
gold must be available to maintain the value of paper money
E
Q35
Monetary policy aimed at reducing demand pull inflation in the country may be carried through
A
increase in taxation of private companies, public corporations and private individuals
B
increase in cash reserve ratio of commercial banks and sale of government securities
C
decrease in government expenditure of education
D
direct price control in the market place
E
Q36
Below equilibrium, the gap between aggregate demand and the full employment level of income is called the
A
inflationary gap
B
income gap
C
unemployment gap
D
deflationary gap
E
Q37
Devaluation is effective when
A
demand for imports is price inelastic
B
demand for imports is neutral
C
production for export is low
D
demand for exports is price elastic
E
Q38
To reduce the high rate of inflation in the economy the Government shouls
A
increase taxes and have a budget surplus
B
increase taxes and have a budget deficit
C
decrease taxes and have a budget deficit
D
decrease taxes and have a balanced budget
E
Q39
One disadvantage of trade by barter is that
A
people are happier when they exchange the same quantities of goods through the medium of money rather than by barter
B
the person wishing to buy good X may not have good Y which is what the other person wants
C
one person must always be cheated when trade takes place by barter
D
it increases the initial cost of producing goods
E
Q40
To perform its function as a store of wealth and standard of differed payment, money must be
A
portable
B
in attractive form
C
stable in value
D
spent more on capital goods than on consumer goods
E
Q41
Fiduciary issue is that part of
A
the side of notes backed entirely by gold
B
a country's currency which is not negotiable
C
the issue of notes not backed by gold
D
a country's currency officially issued
E
Q42
Which of the following is likely to be inflationary
A
Tax increase
B
Increase in unemployment
C
Budget surplus
D
Wages increase
E
Q43
Disposable income is an income which
A
is available for consumption and savings
B
pensioners receive from the government
C
is payable to the disabled members of the community
D
accrues to the environmental sanitation authorities for refuse disposal
E
Q44
The term 'double coincidence' of wants is usually associated with a
A
bilateral exchange mechanism
B
monetary exchange mechanism
C
stock exchange system
D
barter exchange mechanism
E
Q45
A major factor affecting the value of money is that
A
price level
B
banking habit
C
transaction motive
D
divisible nature of money
E
Q46
Cost-push inflation is caused by
A
growth of government expenditure
B
increase in factor prices
C
increase in money supply
D
hoarding
E
Q47
In any economy, what is used as money is determine by
A
government acceptance of a commodity standard
B
government acceptance of an inconvertible paper standard
C
laws and customs
D
its use as a store of value
E
Q48
the rate at which money changes hands is known as the
A
rate of inflation
B
velocity of transactions
C
velocity of money
D
velocity of circulation
E
Q49
In the Keynesian model
A
demand for money is inversely related to the rate of interest
B
investment is directly related to the rate of interest
C
investment is not related to the ratio of interest
D
the demand for money is directly related to the rate of interest
E
Q50
If inflation is anticipated to continue
A
people will lose confidence in goods
B
lenders will demand higher interest rates
C
the growth of full-employment output will be accelerated
D
people will want to hold more money
E
Q51
The difference between personal income and personal disposable income is
A
personal income tax
B
investment income
C
personal savings
D
consumption expenditure
E
Q52
To control inflation, the monetary authorities of a country can
A
reduce taxes
B
advise government to increase its expenditure
C
engage in expansive monetary policy
D
engage in restrictive monetary policy
E
Q53
Deflation is a persistent fall in the general price level and is usually caused by
A
a reduction in total demand
B
an increase in government spending
C
an increase in the money supply
D
an increase in aggregate demand
E
Q54
Which of the following causes of inflation is related to demand-pull inflation
A
Low productivity on farms and in firms
B
Poor storage facilities
C
Poor distribution system
D
Increase in government expenditure on construction
E
Q55
The purchasing power of the Naira will fall when
A
the Naira is devalued
B
government cuts all salaries and wages
C
there is inflation
D
the colour of the Naira is changed
E
workers are retrenched
Q56
Because money serves as a standard of deferred payments means
A
it serves as a store of value
B
goods can be bought on credit with predetermined value
C
future trade becomes possible
D
it serves as a unit of account
E
it becomes valuable
Q57
Which of the following is a necessary prerequisite for trade by barter?
A
Need for double coincidence of wants
B
Multiple exchange rate
C
Impossibility of future trade
D
Impossibility of large-scale production
E
Indivisibility of commodities
Q58
Devaluation of the Naira as a condition for the International monetary Fund loan is considered inadvisable because
A
it would allow for more money to be spent on luxuries
B
the interest rate on the loan would increase
C
it would decrease the demand for Nigeria
D
it would worsen Nigeria's foreign exchange situation
E
Nigeria's oil would sell for less in the world market
Q59
The most important characteristic of money is
A
portability
B
intrinsic value
C
acceptability
D
usefulness
E
beauty
Q60
Cost push inflation takes place due to
A
the rapid increase in the demand for goods
B
an increase in productivity of the factors of production
C
a rise in the cost of production
D
a rise in the standard of living
E
the low wage rate of the workers