ECON Book Final Part 4

Which conclusion about sales and excise taxes is supported by the graph?

• They follow a regressive pattern
• They follow a proportional pattern
• They follow a progressive pattern
• They follow a constant pattern

Which of the following services might be reduced if local property taxes were reduced?

• public transportation
• interstate highways
• Social Security
• U.S. military

Based on the information in the table, how do state taxes help residents afford college?

• If students go to an in-state public or community college, they pay a lower rate of tuition
• If students go to an out-of-state public or community college, they pay a lower rate of tuition
• If students go to an out-of-state private college, they pay a lower rate of tuition
• If students go to an in-state private college, they pay a lower rate of tuition

Which of the following is a way the federal government spends taxes in a mandatory manner?

• to provide unemployment benefits
• to provide for public education
• to provide retirement benefits
• to provide for the national defense

How would the federal government's spending be affected by record profits in leading corporate industries?

• The federal government would spend a lower percentage of its revenue on discretionary programs
• The federal government would spend a higher percentage of its revenue on mandatory programs
• The federal government would be able to fund new or existing discretionary programs
• The federal government would be required to increase spending on mandatory programs

Why were John Maynard Keynes's views on responding to economic downturns controversial in the context of the U.S. free enterprise system?

• His views of government spending to assist economic growth sharply contrasted with free market ideals, which emphasized less government intervention in the market
• He argued in favor of a balanced budget amendment, which forced politicians to make difficult fiscal decisions
• He supported an energetic monetary policy to control the money supply, which created massive fluctuations in the stock market
• He suggested a "wait and see" attitude in addressing changes in the business cycle to allow the economy to recover on its own, which often prolonged economic downturns

"Government spending has become so extensive that it contributes to the economic problems it was designed to cure. More government intervention in the economy cannot possibly be a solution to our economic problems." 
—Ronald Reagan, White House Report on the Program for Economic Recovery, 1981
What policies did this belief lead President Reagan to implement?

• supply-side economics
• Keynesian economics
• demand-side economics
• macroeconomic policies

Which post- Great Depression economic policies are best represented by the graphs above?

• Keynesian economics
• laissez-faire economics
• supply-side economics
• classical economics

Increasing government spending to stimulate growth is made difficult by the reality of entitlements because

• they leave only a small part of the budget available for changes in spending
• they leave such a wide area in which to make spending decisions
• entitlement payments change from year to year, making other decisions difficult
• entitlement spending decisions come last in the budget process

To which economic indicator is monetary policy most directly related?

• the interest rate spread between Treasury bonds and the federal funds rate
• average weekly hours, manufacturing
• manufacturer's new orders for consumer goods and materials
• stock prices, 500 common stocks