Econ Unit 5 Lesson 2 Quizziz

What is the term for government programs that automatically increase spending or decrease taxes when the economy slows down, without new government action?

• Automatic stabilizer

• Laffer curve

• Monetarism

• Stagflation

Which economic theory emphasizes the importance of aggregate demand in influencing economic output and employment?

• Supply-side economics

• Keynesian economics

• Classical economics

• Monetarism

What is the main goal of contractionary fiscal policy?

• Increase government spending

• Reduce inflation

• Lower taxes

• Increase unemployment

Which term describes the situation when government borrowing leads to higher interest rates and reduces private investment?

• Crowding-out effect

• Multiplier effect

• Easy-money policy

• Open-market operations

What is deficit spending?

• When the government spends less than it collects in taxes

• When the government spends more than it collects in taxes

• When the government balances its budget

• When the government only spends on defense

Which policy is used to increase the money supply and encourage economic growth?

• Tight-money policy

• Easy-money policy

• Contractionary fiscal policy

• Reserve requirement

What does the Laffer curve illustrate?

• The relationship between tax rates and tax revenue

• The relationship between inflation and unemployment

• The effect of government spending on GDP

• The impact of interest rates on investment

Which term refers to a period of slow economic growth combined with high inflation?

• Stagflation

• Monetarism

• Fiscal policy

• Expansionary policy

What is the required reserve ratio?

• The percentage of deposits banks must keep in reserve

• The interest rate charged by the Federal Reserve

• The amount of money banks can lend out

• The total amount of government spending

Which policy involves the buying and selling of government securities to influence the money supply?

• Open-market operations

• Fiscal policy

• Deficit spending

• Supply-side economics