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MONETARY AND FISCAL POLICY

Authored by Joshua Scharfenberger

Social Studies

11th Grade

Used 36+ times

MONETARY AND FISCAL POLICY
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28 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If Congress increases government spending by the same amount it increases taxes aggregate demand will

remain the same
decrease, these are both contractionary
increase
shift down

2.

MULTIPLE CHOICE QUESTION

20 sec • 1 pt

If the Federal Reserve raises interest rates to combat rapid inflation, what might be a negative outcome?

Unemployment rates would rise
taxes will rise 
The government would put a freeze on prices
international trade would stop 

3.

MULTIPLE CHOICE QUESTION

20 sec • 1 pt

The Federal Reserve wants to reduce the nation's money supply. This could be accomplished by doing all of the following EXCEPT

decreasing the discount rate.
increasing the reserve requirement.
selling securities on the open market.
making banks hold a reserve for all types of deposits.

4.

MULTIPLE CHOICE QUESTION

20 sec • 1 pt

If the Federal Reserve System wanted to stimulate the U.S. economy and reduce unemployment, it would

A. cause interest rates to decrease because low interest rates encourage businessgrowth and expansion
B. cause interest rates to rise because high interest rates encourage business growthand expansion
C. increase the discount rate it charges banks, which would increase the money supply
D. increase consumer spending by reducing the money supply

5.

MULTIPLE CHOICE QUESTION

20 sec • 1 pt

If the Federal reserve and Government are attempting to encourage growth and stimulate the economy, which actions would each take? 
(monetary / fiscal)

increase the Required reserve / increase government spending
sell government securities / decrease taxes
decrease the interest rate / increase government spending
buy government securities / decrease government spending

6.

MULTIPLE CHOICE QUESTION

20 sec • 1 pt

The rate the Fed charges banks for a loan

Discount rate
Federal fund rate
reserve ratio
prime rate

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Media Image

Congress and the President are responsible for implementing

Monetary policy

Fiscal policy

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