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Understanding Fiscal vs. Monetary Policy

Authored by Brad Stockreef

Professional Development

12th Grade

DOK Level 1: Recall covered

Used 4+ times

Understanding Fiscal vs. Monetary Policy
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23 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following is a primary tool of monetary policy used by the Federal Reserve?

Taxation

Government Spending

Interest Rates

Trade Tariffs

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What happens to the money supply when the Federal Reserve increases interest rates?

The money supply increases

The money supply decreases

The money supply remains unchanged

The money supply becomes unpredictable

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which department of the federal government does the Federal Reserve belong to?

Department of Treasury

Department of Commerce

Department of the Interior

None

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If inflation is rising, what is the Federal Reserve likely to do?

Lower interest rates

Increase interest rates

Increase government spending

Decrease taxes

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the primary goal of fiscal policy?

Control inflation

Manage unemployment

Regulate the money supply

Influence economic activity through government spending and taxation

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If the economy needs stimulating, what is the government likely to do?

Increase taxes

Decrease government spending

Increase government spending

Increase interest rates

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Explain how an increase in interest rates can affect consumer spending and business investment.

It encourages more consumer spending and business investment.

It discourages consumer spending and business investment.

It has no effect on consumer spending and business investment.

It only affects consumer spending, not business investment.

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