AMSCOpo 396-401

Fiscal policy involves decisions on

• government taxing and spending

• interest rates charged by the central bank

• whether certain groups should receive benefits

• treatment of persons accused of crimes

Keynesian policy would most likely agree with

• government spending to increase demand

• cutting interest rates to increase borrowing

• cutting taxes to increase demand

• increasing tariffs to protect domestic industry

Which of the following is most compatible with supply-side economics?

• laissez-faire

• Keynesian economics

• the New Deal

• progressive income tax

A progressive income tax

• taxes higher incomes at a higher rate

• takes the same percentage of taxes from every income bracket

• is unconstitutional

• is a conservative policy