Fiscal Policy & Government

The 3 major measures of macroeconomic activity are

• GDP, CPI, GRE

• GRE, Peak, CRD

• GDP, CPI, Unemployment

• Aggregate Demand, Consumer Produce Index, Employment Rate

Gross Domestic Product. also referred to as GDP is a measure of

• the sum of consumption by households, investment by businesses, government spending and net exports

• dollar value of all final G/S produced in a country in a 12-month period

• the primary quantitative measure of economic activity

• All of these answers are correct

• None of these answers are correct

Fiscal policy is defined as

• a monetary policy that involves the discount rate and open market operations to speed up or slow down the economy

• changes in federal government spending or tax rates that influence the business cycle of the economy

• policy used by the FED or FRS only

• a monetary policy that uses the buying & selling of bonds to influence the economy

Fiscal Policy in the US was first used during the _________________ by President _____________________.

• Cold War, John Kennedy

• WWI, Wilson

• Great Depression, Franklin D. Roosevelt

• WWI, Truman

The government uses changes in expenditures and/or taxes associated with Fiscal Policy to achieve the economic goals of

• a balanced budget, low taxes, high tarrifs

• price stability, economic decline, inflation

• economic growth, high unemployment, deflation

• full employment, stable prices, economic growth

Changes in government expenditures and/or taxes associated with Fiscal Policy are the responsibility of

• the Supreme Court

• The Federal Reserve System

• Congress & the President

• the local court system

Increased government spending eventually becomes income for businesses and consumers is an economic principle known as

• Supply Side Economics

• Tools of Monetary Policy

• Contractionary Policy

• Multiplier Effect

Increased government spending associated with Fiscal Policy eventually becomes income for businesses and consumers and is designed to encourage growth of ___________.

• supply

• demand

• the money supply

• inflation

Fiscal Policy consists of

• Tight Money Policy & Easy Money Policy

• Monetary & Credit Policies

• Contractionary Policy & Exansionary Policy

• Interest Rates & Exchange Rates

Tools of Fiscal Policy include

• Federal taxes & government spending

• Monetary Policy & Trade Agreements

• Interest Rates & Reserve Requirements

• Government Regulations & Borrowing