Fiscal Policy

Which of these is NOT an example of fiscal policy action government can take?

• Raising/Lowering Taxes

• Borrowing Money

• Increase/Decrease Spending

• Raising/Lowering Reserve Requirement

During a recession, the government should....

• lowering taxes

• increase the money supply

• increase government spending

• all of these

During an inflationary period, the government should....

• increase taxes

• reduce the money supply

• reduce spending

• all of these

During Great Depression, which economic policy would have you recommended to FDR?

• cut government spending

• raise taxes

• increase government spending

• all of these

Which of these are laws designed to protect consumers from harm?

• Unemployment Opportunity Act

• Environmental Protection Agency

• Not-So Pure Food & Drug Act

• all of these

Which is best action government takes when inflation is widespread in the U.S. economy?

• raising taxes on foreign governments

• lowering tariff rates on imports

• raising taxes on individuals and businesses

• closing state banks

A major tool of the government is to promote economic growth & stability is its ability to....

• control the banking system

• change federal income tax rates

• manage the supply of currency

• issue environmental regulations

Main reason government spends more than it collects in taxes during a depression would be to....

• promote corporate mergers

• put more money into the economy

• encourage competition between businesses in the same field

• lower the tax costs for businesses

People buy less, factories produce less, fewer workers employed best describes....

• depression

• inflation

• discretionary spending

• aggregate demand

What might motivate Congress to increase taxes and decrease government spending?

• rising unemployment rate

• increase in consumer spending

• falling level of aggregate demand by consumers

• declining corporate spending