PTE Academic · full test
PTE Academic reading practice set 4
The hardest of our PTE Academic reading sets: fifteen questions on gene regulation, a long debate in British economic history, measurement targets, non-native species, Brutalist architecture and radiocarbon dating. Multiple Choice and Reading Fill in the Blanks, untimed.
Exam mode: timed, answers at the end, like the real test. Practice mode: untimed, the answer and explanation after each question.
What is in this test
| Multiple choice, one answer | 10 questions | instant marking |
| Multiple choice, three answers | 3 questions | instant marking |
| Multiple choice, two answers | 2 questions | instant marking |
Covers: mcq single answer (5) · mcq multiple answers (5) · reading fill in blanks (5)
A sample question
Over the past four decades, many countries have given their central banks independence from day-to-day political control over interest rates. The argument rests on a problem of credibility. Elected governments facing an election may be tempted to lower interest rates to boost growth in the short term, even if this risks higher inflation later. If households and businesses expect such behaviour, they will build higher inflation into wage demands and prices, making inflation harder to control. Handing interest-rate decisions to an independent body with a clear mandate, usually a target for inflation, is intended to make the commitment to low inflation more believable. Evidence from the 1980s and 1990s appeared to support the approach, since countries with more independent central banks tended to have lower inflation. Critics noted, however, that this correlation might partly reflect other factors: societies with a strong dislike of inflation might be more likely both to grant independence and to tolerate the policies needed to keep prices stable. Independence has also raised questions of democratic accountability. Since the financial crisis of 2008, central banks have taken on larger roles, buying government bonds on a vast scale and influencing house prices, savings and the distribution of wealth. Some observers argue that decisions with such broad effects should be subject to closer democratic control, while others warn that weakening independence could revive the very credibility problem it was designed to solve. Which of the following are supported by the passage? Select ALL the correct answers (3 are correct).
- Central bank independence was introduced mainly to increase economic growth before elections.
- Expectations of future inflation can themselves make inflation harder to control.
- Since 2008 central banks have become less influential.
- The link between independence and low inflation may partly reflect public attitudes towards inflation.
- Independent central banks usually have no stated target.
- Some observers believe that decisions with wide effects need greater democratic oversight.
- All economists agree that independence caused lower inflation in the 1980s and 1990s.
Marked when you take the test; the explanation appears in your review.