
Expansionary fiscal policy
Passage
•
Other
•
12th Grade
•
Practice Problem
•
Hard
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9 questions
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1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What was the main goal of Japan's expansionary fiscal policy during the 1990s and 2000s?
A) To increase government revenue
B) To expand aggregate demand and the level of economic activity
C) To reduce public investment
To increase government revenue
To expand aggregate demand and the level of economic activity
To reduce public investment
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What triggered a severe financial crisis in Japan in the early 1990s?
Dramatic economic deflation
Economic inflation
Real estate sector decline
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
How did the Japanese government attempt to boost employment and economic growth as part of its expansionary fiscal policy?
By launching a huge public works investment program
By increasing income taxes
By cutting public works investments
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What was the effect of reducing the marginal income tax rate for high-income individuals from 65% to 50% in 1999?
A) Decreased disposable income
Increased government debt
Increased disposable income and stimulated spending and investment
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What best describes the role of the economic multiplier in the context of Japan's expansionary fiscal policy?
It indicates a decrease in government spending has a smaller impact on the overall economy than the initial amount spent.
It shows the consequential increases in AD as endogenous variables, post an exogenous change in one of the components of AD (usually G), amplifying the impact of government spending or tax cuts.
It shows AD being multiplied 10 times post an increase in G as an exogenous variable in AD
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What challenge did the Japanese government face with tax cuts introduced in the early 2000s?
A) Immediate economic overheating
B) Long-term fiscal sustainability concerns
C) Instant eradication of public debt
Long term fiscal sustainability concerns
Problems of time lags in the long run
Instant eradication of public debt
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
How did expansionary fiscal policy benefit consumers in Japan?
Reducing purchasing power
Increasing disposable income and living standards
Inflationary pressures
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