# Value of Money MCQ

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## 1. Speculative demand for money depends upon:

A. Income

B. Investment

C. Rate of interest

D. Central bank

## 2. If money supply in a country decrease:

A. Prices will rise

B. Prices will fall

C. Rate of interest falls

D. (b) and (c) of above

## 3. In the equation MV = PY, V represents:

A. Value of money

B. Velocity of circulation of money

C. Variation of nation income

D. All of the above

## 4. In the equation MV = PY, M represents:

A. Money supply

B. Money demand

C. Maximum output

D. Minimum output

A. Two

B. Three

C. Four

D. Five

## 6. Quantity Theory of Money explains that:

A. Value of money depends upon quantity of money

B. Rate of interest depends upon quantity of money

C. Quantity of investment depends upon quantity of money

D. Supply of money depends upon quantity of money

## 7. Cross cheque has a cross sign (X) in the:

A. Right side upper corner

B. Right side lower corner

C. Left side upper corner

D. It does not have cross sign (X)

## 8. Cross cheque means:

A. It has been cancelled

B. Cash cannot be directly drawn from the bank

C. It has two lines drawn in left upper corner

D. (b) and (c) of above

A. Reduced

B. Increased

C. Constant

D. Fluctuating

## 10. Velocity of circulation of money means the number of times a unit of money

A. Changes hands daily

B. Changes hands monthly

C. Changes hands annually