Fiscal Policy Quiz 26 (8 MCQs)

Quiz Instructions

Select an option to see the correct answer instantly.

1. This monetary policy tool is used to determine the amount of deposits that banks must hold

Correct Answer: B) Reserve requirement ratio.

2. The largest source of state and local revenue is .....

Correct Answer: D) Sales taxes.

3. How does the Federal Reserve buying bonds affect the size of the money supply?

Correct Answer: A) It increases the money supply.

4. Which is NOT an example of pork barreling?

Correct Answer: D) $ 2 billion on Veteran's affairs.

5. If Fiscal Policy is trying to promote stability and economic growth through tax cuts, what type of policy is Fiscal policy using?

Correct Answer: A) Expansionary Fiscal Policy.

6. When the Fed buys and sells government securities, they are attempting to influence .....

Correct Answer: A) Federal funds rate.

7. Which of the following is not part of the Fed

Correct Answer: A) Congressional Budget Office.

8. FOMC is made up of ..... and .....

Correct Answer: D) Board of Governors . . . . Five Presidents of the Federal Reserve Banks.