Macroeconomic Concepts Study Quiz

What is the difference between discretionary and mandatory spending?

• Discretionary spending is determined through annual appropriations, while mandatory spending is set by existing laws.

• Discretionary spending is set by existing laws, while mandatory spending is determined through annual appropriations.

• Both discretionary and mandatory spending are determined through annual appropriations.

• Both discretionary and mandatory spending are set by existing laws.

The Federal Reserve plays a role in banking and controlling the supply of money by using tools such as _____ and _____.

_____ gives Congress the power to tax, but Congress can't tax our _____.

What is the difference between a tax base and a tax structure?

• A tax base is the rate at which income is taxed, while a tax structure is the total amount of assets or income that can be taxed.

• A tax base is the system or method of taxation, while a tax structure is the total amount of assets or income that can be taxed by a government.

• A tax base and a tax structure are the same, both referring to the total amount of assets or income that can be taxed by a government.

• A tax base is the total amount of assets or income that can be taxed by a government, while a tax structure refers to the system or method of taxation.

Which of the following features make a tax a good tax?

• High-Rates and Burden

• Complex and Comfusing

• Equitable and Simple

• Lack of Transparency

The difference between monetary and fiscal policy is that monetary policy tries to manipulate _____, while fiscal policy tries to manipulate _____.

The Federal Reserve is organized with a chairman who serves a term of _____ years and is picked by _____.

How did we define the word TAX?

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The majority of our government's money comes from _____.

What is the difference between contractionary and expansionary fiscal policy?

• Contractionary fiscal policy increases spending and cuts taxes, while expansionary fiscal policy reduces spending and increases taxes.
• Contractionary fiscal policy has no effect on taxes, while expansionary fiscal policy only affects government investments.
• Contractionary fiscal policy focuses on increasing government debt, while expansionary fiscal policy aims to decrease it.
• Contractionary fiscal policy reduces spending and increases taxes, while expansionary fiscal policy increases spending and cuts taxes.