Demand side policies

Which of the following is an example of monetary policy?

• An increase in taxes on businesses

• An increase in government spending on infrastructure

• A decrease in interest rates

• A decrease in subsidies for renewable energy

What is the main objective of demand-side policies?

• To stimulate economic growth

• To reduce inflation

• To increase unemployment

• To reduce government spending

Which of the following is a demand-side policy to stimulate aggregate demand?

• Structural policies

• Supply-side policies

• Fiscal policy

• Labour market policies

Which of the following is an example of a demand-side policy aimed at reducing unemployment?

• An increase in taxes on businesses

• An increase in government spending on education

• An increase in interest rates

• A decrease in subsidies for renewable energy

What is the primary goal of open market operations?

• To control inflation

• To stimulate economic growth

• To increase government revenue

• To control the money supply in an economy

Which of the following is an example of expansionary open market operations?

• The central bank sells government securities

• The central bank buys government securities

• The central bank increases reserve requirements

• The central bank decreases the discount rate

What is the purpose of the minimum reserve requirement?

• To provide additional income for the government.

• To encourage banks to invest in the stock market

• To ensure that banks have enough money to meet their obligations

• To prevent banks from lending out too much money

How does the minimum reserve requirement affect the money supply?

• It decreases the money supply.

• It increases the money supply.

• It has no effect on the money supply.

• It can increase or decrease the money supply, depending on the situation.

When the government increases taxes to decrease aggregate demand, it is using:

• Expansionary fiscal policy

• Contractionary fiscal policy

• Neutral fiscal policy

• None of the above

Which of the following is a limitation of fiscal policy?

• It is subject to political influence

• It is too slow to respond to economic changes

• It is expensive to implement

• All of the above