ATARMAxxing · Economics
QCE Economics Practice Questions
64 exam-style questions · full worked solutions
The 64 practice questions inside the QCE Economics Mastery Pack, grouped by area of study. Every question comes with a full worked solution.
- International trade
- Multiple choice × 12
- Construct and explain × 1
- Analyse × 1
- Explain × 1
- Evaluate × 1
- Global economic issues
- Multiple choice × 12
- Analyse × 1
- Compare × 1
- Evaluate × 1
- Explain × 1
- Macroeconomic objectives and theory
- Multiple choice × 12
- Analyse × 1
- Explain × 1
- Calculate and interpret × 1
- Evaluate × 1
- Macroeconomic management
- Multiple choice × 12
- Explain × 1
- Analyse × 1
- Evaluate × 1
- Discuss × 1
Sample question
The Reserve Bank of Australia (RBA) raises the cash rate from 4.10% to 4.35%. Which of the following describes the FIRST-ORDER effect of this decision on commercial banks?
- A. Commercial banks immediately reduce their lending to the federal government.
- B. Commercial banks increase the interest rates they charge on loans and pay on deposits.
- C. Commercial banks increase their reserve holdings to meet new prudential requirements.
- D. Commercial banks reduce the exchange rate at which they convert Australian dollars.
Show the worked answer
Answer: B
The cash rate is the rate banks pay to borrow overnight funds; a rise flows directly through to higher lending and deposit rates — the interest rate transmission channel.
Included in the QCE Economics Mastery Pack
20 full-length practice exams with worked solutions, 20 revision notes, 64 practice questions and 200 flashcards.
Preview a sample note and question free on the QCE Economics hub →