Fiscal Policy

Who is in charge of fiscal policy?

• Government
• Federal Reserve

Taxing & spending to help the economy grow is referred to as

• expansionary policy
• monetary policy
• contractionary policy
• budget deficit

The federal government's overall approach to spending and taxes is called

• Physical Policy
• Fiscal Policy
• Money
• Monetary Policy

An example of expansionary fiscal policy would be

• cutting taxes.
• cutting government spending.
• cutting production of consumer goods.
• cutting prices of consumer goods.

If and economy experiences a dramatic rise in prices, which fiscal policy action could be taken?

• Selling securities on the open market
• Raising interest rates
• Reducing government spending
• Raising reserve requirements

The Federal government is concerned that economic growth is too high, that it is unsustainable, and that inflation is resulting. Which of the following fiscal policies  might be enacted to reduce inflation?

• Increasing taxation
• Open market sales
• decreasing taxation
• Increasing government spending

Which of the following is not a tool of fiscal policy?

• Taxing
• Spending
• Interest Rates
• All of these options are tools of fiscal policy.

When the government raises taxes, what does it take out of circulation?

• Money
• Credit
• People
• Jobs

Fiscal policy is defined as:

• the use of government taxing and spending to promote economic stability.

• the policy of laissez-faire.

• a set of government actions designed to increase unemployment over 5%.

• the use of government quotas to decrease GDP and unemployment.

A surplus budget is one where

• government revenue is less than government spending

• government revenue exceeds government expenditure

• spending on imports exceeds export earnings

• spending on imports is less than export earnings.