Fiscal Policy Review

The Central bank of the United States is called

• The Federal Reserve

• Bank of the United States

• US Bank

• Bank of America

When the President/Congress decrease taxes, this would...

• Increase consumers spending and increase economic growth

• Decrease consumer spending and economic growth

• Have no effect on consumer spending or economic growth

The goal of contractionary fiscal is

• To decrease unemployment and increase economic growth

• To increase inflation

• To decrease inflation

• To increase unemployment and decrease economic growth

The two tools of Fiscal policy are (Select Two)

• The military

• Taxes

• Government Spending

• These hands

If unemployment is increasing and economic growth has slowed down, the President and Congress should

• Use Expansionary Fiscal Policy by increasing spending

• Use contractionary fiscal policy by decreasing spending

When the our government spends more than it takes in during a given year we are in

• a budget surplus

• a budget deficit

• a neutral budget

• a trade deficit

When interest rates on loans are high

• people and businesses buy less and save more

• people and businesses buy more and save less

• people and businesses do not change their behavior

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

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

Taxing & spending to slow the economy is referred to as 

• budget surplus 
• monetary policy
• contractionary policy
• budget deficit

An example of expansionary fiscal policy would be

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