This quiz works best with JavaScript enabled. Home > Fiscal > Policy > Fiscal Policy – Quiz 22 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Fiscal Policy Quiz 22 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which of the following is a cost of government regulations? A) Consumers protected from harm. B) Decreased profits for corporations. C) More rainbows, unicorns, and narwhals. D) More money in consumer's pockets. Show Answer Correct Answer: B) Decreased profits for corporations. 2. What area, according to Keynesian economists, can be managed rationally? A) Government taxation and spending. B) Investment. C) Consumer spending. D) Net Exports. Show Answer Correct Answer: A) Government taxation and spending. 3. Which of the following is an automatic stabilizer? A) A government stimulus package. B) An increase in the personal income tax rates. C) Unemployment compensation for those who have lost their jobs. D) Open Market Operations. Show Answer Correct Answer: C) Unemployment compensation for those who have lost their jobs. 4. Higher discount rate, higher interest rates, higher reserve requirement A) Contractionary Fiscal Policy. B) Expansionary Fiscal Policy. C) Contractionary Monetary Policy. D) Expansionary Monetary Policy. Show Answer Correct Answer: C) Contractionary Monetary Policy. 5. Percentage of deposits that the Fed requires banks to hold back and not lend out A) Fed Fund Rate. B) Reserve Requirement Rate. C) Discount Rate. D) I.O.U Rate. Show Answer Correct Answer: B) Reserve Requirement Rate. 6. This is the roads, bridges, power lines, tunnels, railways, and airports of a country that allow for the conduct and expansion of business opportunities and safety of the population A) Infrastructure. B) Discretionary spending. C) Taxes. D) Spending. Show Answer Correct Answer: A) Infrastructure. 7. Crowding In is connected to Contractionary Policy and A) Depreciates the dollar and increases Ig. B) Appreaciates the dollar and decreases Ig. C) Increases interest rates. D) AD moving to the right ONLY. Show Answer Correct Answer: A) Depreciates the dollar and increases Ig. 8. The amount of money in the economy at a particular point in time is known as A) Credit creation. B) Monetary policy. C) Notes and coins. D) The money supply. Show Answer Correct Answer: D) The money supply. 9. In order for money to have value, it must have all of the following characteristics EXCEPT A) Portability. B) Durability. C) Divisibility. D) Plentiful availability. Show Answer Correct Answer: D) Plentiful availability. 10. Sustained upward movement in the price of goods and services (price increase over time) A) Interest rates. B) Discount rates. C) Reserve requirements. D) Inflation. Show Answer Correct Answer: D) Inflation. 11. A surplus budget is one where A) Government revenue is less than government spending. B) Government revenue exceeds government expenditure. C) Spending on imports exceeds export earnings. D) Spending on imports is less than export earnings. Show Answer Correct Answer: B) Government revenue exceeds government expenditure. 12. Fiscal policy during periods of inflation is likely to be ..... A) Expansionary. B) Contractionary. C) Both Expansionary and Contractionary. D) Neither Expansionary note Contractionary. Show Answer Correct Answer: B) Contractionary. 13. Which of the following best defines "estate tax" ? A) Tax on donation of money or wealth. B) Tax on people's earnings. C) Tax on the manufacture or sale of certain items. D) Tax on the transfer of property when someone dies. Show Answer Correct Answer: D) Tax on the transfer of property when someone dies. 14. What is the factor by which a change in both spending and taxes affect real GDP A) Multiplier effect. B) Balanced budget multiplier. C) Lump-sum tax. D) None of above. Show Answer Correct Answer: B) Balanced budget multiplier. 15. The amount of money the federal government collects is called A) Deficit. B) Budget. C) Funding. D) Revenue. Show Answer Correct Answer: D) Revenue. 16. The SARB wants to reduce the nation's money supply. This could be accomplished by doing all of the following EXCEPT A) Decreasing the repo rate. B) Increasing the reserve requirement. C) Selling securities on the open market. D) Making banks hold a reserve for all types of deposits. Show Answer Correct Answer: A) Decreasing the repo rate. 17. Which action increases the money supply? A) The Fed BUYS bonds on the market. B) The Fed raises the discount rate. C) The federal gov. decreases government spending. D) The federal gov. increases personal income taxes. Show Answer Correct Answer: A) The Fed BUYS bonds on the market. 18. The Federal Reserve would do which of the following in order to expand the economy? A) Sell bonds. B) Raise the discount rate. C) Buy bonds. D) Raise the reserve requirement. Show Answer Correct Answer: C) Buy bonds. 19. A Federal deficit occurs when A) Exports exceed imports. B) Spending exceeds tax revenue. C) The dollar is weak internationally. D) MPC increases. Show Answer Correct Answer: B) Spending exceeds tax revenue. 20. What is Taxes A) Source of the gov revenue paid by citizens. B) Citizens who will benefit from the use of the tax will pay in tax. C) A citizen will pay more tax if he or she is able to pay more. D) None of above. Show Answer Correct Answer: A) Source of the gov revenue paid by citizens. ← 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