After reading back a clearance to descend from 3;000 FT to 2;000 FT during radar vectors for approach at MMU; a CE750 Captain reports receiving a GPWS terrain warning and initiating a climb. ATC indicates the aircraft should be at 3;000 FT.

Narrative

On approach and under vectors for the ILS 23 into MMU; ATC issued a descent from 3;000 to 2;000 FT. We read back and selected 2;000 in the altitude alerter. Using vertical speed; I dialed down our descent to 1;000 FPM. At approximately 2;300 FT we received a 'Caution Terrain' then almost immediately a 'Whoop Whoop Pull Up.' I disengaged the autopilot and manually climbed the aircraft to approximately 2;500 FT. The GPWS warnings stopped and we queried ATC as to our assigned altitude and he responded that we should be at 3;000 FT. He issued a climb to maintain 3;000 FT and we complied. Nothing further was said. We landed without further incident. The Approach Controller was moderately busy and our task load was quite high in anticipation of landing. It is quite possible that we could have answered a descent issued to another aircraft; or that he got our callsign confused with another aircraft on the same frequency; but it is my firm belief that we did answer a call for us. Either way; I believe that we did react correctly to the situation and did query ATC to the situation which caused the GPWS warning and recovered to a safe altitude and proceeded without anything else being said. The Controller never asked us to call or indicated that we were in violation of any clearances issued.