Fiscal & Monetary Policy

Front

Which of the following is responsible for fiscal policy?

• the Federal Bureau of Investigation
• the Federal Reserve
• Congress & the President
• the Federal Reserve banks

Back

Congress & the President

Front

Which of the following statements is true?

• Contractionary monetary policy would increase government revenue & slow down the economy.
• Contractionary fiscal policy would decrease the money supply & slow down the economy.
• Contractionary fiscal policy would lead to a decrease in national debt.
• Contractionary monetary policy leads to a budget deficit.

Back

Contractionary fiscal policy would lead to a decrease in national debt.

Front

Which fiscal policy tool would be used if the economy were in a trough?

Back

increase government spending

Front

Which fiscal policy tool would decrease the national debt? Options: increase income taxes, decrease income taxes, increase money supply, decrease money supply.

Back

increase income taxes

Front

Which monetary policy tool would speed up the economy?

Back

decreasing interest paid on reserves to increase the money supply

Front

Which combination of fiscal and monetary policy would speed up the economy?

Back

decrease income taxes; increase money supply

Front

Which monetary policy tool would be expansionary?

Back

Decrease reserve requirement to increase the money supply.

Front

The President is directly involved with which of the following? fiscal policy, monetary policy, setting interest rates, changing the money supply

Back

fiscal policy

Front

If the government is concerned about unemployment, which fiscal policy tool would they use?

Back

increase government spending

Front

How are monetary policy and fiscal policy similar?

Back

They are both used to keep the economy stable.