Economics in Government (pre assessment)

Which of the following is NOT a job of the Federal Reserve Bank?

• Raising or lowering taxes

• Raising or lowering the discount rate

• Buying or selling government bonds

• Raising or lowering the reserve rate

When the federal government raises taxes and cuts spending, this is known as

• Expansionary fiscal policy

• Expansionary monetary policy

• Contractionary monetary policy

• Contractionary fiscal policy

The discount rate is

• the discount the Federal Reserve Bank gives the government

• the rate at which you borrow money from local banks

• the rate at which businesses borrow from the Federal Reserve

• the rate at which banks borrow money from the Federal Reserve

How do members of the Federal Reserve Board of Governors get their jobs?

• They inherit their jobs from their families

• They are hired by the board as old members die or resign

• They're appointed by the President & confirmed by the Senate

• They are appointed by Congress

Cutting taxes and increasing government spending is an example of

• Contractionary fiscal policy

• Expansionary fiscal policy

• Contractionary monetary policy

• Expansionary monetary policy

When the Federal Reserve Bank buys and sells government bonds, this is known as

• the reserve requirement

• closed market operations

• setting the discount rate

• open market operations

What is the goal of monetary policy?

• To control the prices of goods and services

• To have full employment

• To keep taxes low

• To regulate government spending

This type of spending is required by law to be a part of the federal budget...

• Discretionary spending

• Monetary spending

• Fixed spending

• Regressive spending

Part of the annual budget process, Congress decides where to spend these funds...

• Discretionary spending

• Mandatory spending

• Fiscal spending

• Fixed spending

This type of tax is taken out of your paycheck to pay for programs like social security...

• Payroll tax

• Income tax

• Progressive tax

• Regressive tax