Macro Unit Test Review

Which of the following are responsible for making fiscal policy decision? 

• The President and Congress
• The Federal Reserve System
• The National Council of Economic Advisors
• The commerce Department

Fiscal Policy is concerned with

• Government Spending and taxation
• Consumer spending and productivity
• Government spending and the money supply
• Taxation and inflation

An example of expansionary is what? (Multiple answers - must pick all to receive credit)

• Decrease taxes

• Raise taxes

• Government spends more on Science research

• Government cuts organizations like the National Science Foundation

Examples of contractionary fiscal policy includes which of the following (choose all correct answers)?

• Raise taxes on corporations

• Lower the corporate tax rate

• Government increases spending on research in Antarctica

• Government cuts spending on education

One pro of a flat tax is:

• Taxes the rich more than low-income families

• Many government employees and tax preparers would lose their jobs

• Lawmakers cannot create loopholes for corporations and lobbyists for campaign contributions or personal favors

• Can create corruption and cause loopholes

"The Fed refers to the Federal Reserve System, the Central Bank of the United States. The FOMC is the Federal Open Market Committee, the group responsible for implementing monetary policy."

• Fiscal policy

• Monetary policy

"The U.S. Federal Reserve is almost certain to hike interest rates Wednesday to the highest level in a decade: 1.5 to 1.75 percent. "

• Fiscal policy

• Monetary policy

Monetary policy decisions are decided by:

• Congress

• Senate

• The Fed

• President

The goals of monetary policy include (more than one answer - pick all correct answers for credit):

• regulating the amount of money circulating in the economy

• Keep inflation high

• Keep inflation low

• Keep unemployment low

• Raise the unemployment levels

to help the economy grow, the FED may____________the reserved requirement, allowing banks to loan more people money so that they spend more

• lower

• raise

• spend more

• save more