Monetary and Fiscal Policy: Crash Course Government and Politics

The video tutorial explores the concepts of monetary and fiscal policy, focusing on the Federal Reserve's role in controlling the money supply and interest rates. It explains how the Fed uses tools like open market operations and reserve requirements to influence the economy. The tutorial also covers fiscal policy, discussing the challenges of balancing taxes and government spending, and the impact of mandatory spending on the federal budget.

What is the primary role of the Federal Reserve System?

• To manage the national budget

• To oversee international trade

• To regulate the money supply

• To set tax rates

How does the Federal Reserve influence the economy through interest rates?

• By printing more money

• By increasing taxes

• By setting the discount rate for banks

• By reducing government spending

What is the purpose of the bank reserve requirement?

• To encourage more loans

• To reduce inflation

• To increase bank profits

• To ensure banks have enough cash on hand

What is fiscal policy primarily concerned with?

• Raising taxes and government spending

• Setting interest rates

• Regulating the money supply

• Controlling inflation

What economic theory has influenced tax policy since Ronald Reagan's presidency?

• Classical economics

• Monetarism

• Supply-side economics

• Keynesian economics

Which of the following is considered mandatory spending in the federal budget?

• Infrastructure projects

• Education funding

• Defense spending

• Social Security

What is a major challenge in balancing the federal budget?

• Increasing discretionary spending

• Reducing mandatory spending

• Lowering interest rates

• Increasing exports