U.S. Government Economics and Budget

Who sets monetary policy in the United States?

• Congress

• President

• The FED

• Secretary of the Treasury

Answer explanation

The FED

Fiscal Policy is controlled by...

• The Federal Government

• The Federal Reserve System

• The states

• The Department of Commerce

The two "tools" of Fiscal Policy are:

• the power to tax

• the power to spend

• the power to borrow money

• the power to print money

Taxing & spending to help the economy grow is referred to as

• expansionary policy
• monetary policy
• contractionary policy
• budget deficit

Taxing & spending to slow the economy is referred to as 

• budget surplus 
• monetary policy
• contractionary policy
• budget deficit

Which of the following is an example of expansionary policy?

• The Fed sells bonds
• the Fed raises reserve requirements
• the Fed buys bonds
• the Fed raises the Fed funds rate

Expansionary fiscal policies are laws aimed at reducing unemployment. How might Congress use expansionary fiscal policy?

• Decrease the discount rate

• Increase taxes

• Decrease government spending

• Increase government spending and decrease taxes

Which fiscal policy tool would be used if the economy were in a trough? (Think Recession)

• increase the money supply

• increase individual tax rate

• decrease the money supply

• increase government spending

Which combination of fiscal and monetary policy would speed up the economy?

• increase income taxes; increase the money supply

• decrease income taxes; increase money supply

• increase gov't spending; decrease money supply

• decrease gov't spending; decrease the money supply

The President is directly involved with which of the following?

• fiscal policy

• monetary policy

• setting interest rates

• changing the money supply