This quiz works best with JavaScript enabled. Home > Fiscal > Policy > Fiscal Policy – Quiz 13 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Fiscal Policy Quiz 13 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. A certificate of indebtedness issued by a government A) Stock. B) Bond. C) Type of money. D) None of above. Show Answer Correct Answer: B) Bond. 2. Inside lag takes at least A) 3 quarters. B) 3 months. C) 1 quarter. D) 6 months. Show Answer Correct Answer: D) 6 months. 3. How much must the bank keep on hand if the Required Reserve is 10% and there is a deposit of $ 100. A) 100. B) 110. C) 90. D) 10. Show Answer Correct Answer: D) 10. 4. Government budget comprises of A) Government spending and income tax only. B) Government revenue and government expenditure. C) Transfer payment and government revenue. D) Government spending and indirect tax. Show Answer Correct Answer: B) Government revenue and government expenditure. 5. This is government spending and taxation policies suggested by an economist to stimulate the economy; synonomous with fiscal policies or demand-side economics. A) Adam Smith economics. B) Keynesian economics. C) Reaganomics. D) Ramsey economics. Show Answer Correct Answer: B) Keynesian economics. 6. Which of the following is an example of expansionary policy? A) The Fed sells bonds. B) The Fed raises reserve requirements. C) The Fed buys bonds. D) The Fed raises the Fed funds rate. Show Answer Correct Answer: C) The Fed buys bonds. 7. If we are in a recession, fiscal policy should A) Reduce agricultural subsidies. B) Postpone highway construction programs. C) Reduce taxes. D) Have a surplus budget. Show Answer Correct Answer: C) Reduce taxes. 8. If inflation reaches 5% which of the following is true A) Want to increase the money supply. B) Decrease government spending. C) Decrease reserve requirement. D) Buy bonds. Show Answer Correct Answer: B) Decrease government spending. 9. The FDIC was established to make sure that A) Banks do not fail. B) Depositors do not lose money if a bank fails. C) Banks charge a fair amount of interest on loans. D) The government has enough gold to cover its expenses. Show Answer Correct Answer: B) Depositors do not lose money if a bank fails. 10. If the economy was going into an inflationary period, what would the Federal government do with government spending? A) Increase it. B) Do nothing. C) Decrease it. D) None of above. Show Answer Correct Answer: C) Decrease it. 11. If Congress raises taxes, the FED should A) Buy bonds. B) Sell bonds. C) Decrease the discount rate. D) Decrease spending. Show Answer Correct Answer: B) Sell bonds. 12. What are the two tools the Fed will use to determine monetary policy? A) Taxing and spending. B) Interest rates and reserve requirements. C) Legislation and enforcement. D) Interest rate and tax rates. Show Answer Correct Answer: B) Interest rates and reserve requirements. 13. When the government spends more money than they take in each year is called a ..... ? A) Debt. B) Deficit. C) Surplus. D) Expansionary. Show Answer Correct Answer: B) Deficit. 14. The ratio of change when both spending and taxes change the real GDP A) Multiplier Effect. B) Tax Multiplier. C) -MPC/MPS. D) Balanced Budget Multiplier. Show Answer Correct Answer: D) Balanced Budget Multiplier. 15. The total demand for final goods and services in an economy at a given time. A) Demand. B) Aggregate Demand. C) Supply. D) Aggregate Supply. Show Answer Correct Answer: B) Aggregate Demand. 16. Progressive tax structure is when A) The tax rate declines as income increases. B) The tax rate increases as income increases. C) The tax rate remains the same, regardless of size of income. D) The tax rate increases the total volume of consumer expenditures. Show Answer Correct Answer: B) The tax rate increases as income increases. 17. Which is a monetary measure that helps to reduce unemployment in the economy? A) A cut in taxes. B) Higher amount of government spending. C) Investment in training and development. D) Lower interest rate. Show Answer Correct Answer: D) Lower interest rate. 18. A plan to increase aggregate demand and stimulate the economy A) Contractionary Fiscal Policy. B) Expansionary Fiscal Policy. C) Contractionary Monetary Policy. D) Expansionary Monetary Policy. Show Answer Correct Answer: B) Expansionary Fiscal Policy. 19. A property tax would be a tax that would go to ..... government A) State. B) Federal. C) Local. D) School. Show Answer Correct Answer: C) Local. 20. The percentage of a deposit that a bank must hold on to is called the ..... A) Excess Reserve. B) Interest Rate. C) Credit. D) Required Reserve. Show Answer Correct Answer: D) Required Reserve. ← PreviousNext →Related QuizzesFiscal QuizzesFiscal Policy Quiz 1Fiscal Policy Quiz 2Fiscal Policy Quiz 3Fiscal Policy Quiz 4Fiscal Policy Quiz 5Fiscal Policy Quiz 6Fiscal Policy Quiz 7Fiscal Policy Quiz 8Fiscal Policy Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books