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The Fed and Taxes Test

Total questions: 12

Worksheet time: 6mins

Name
Class
Date
1.

The discount rate and the federal funds rate are both types of what?

a)

quantitative easing

b)

interest rates

c)

monetarism

d)

passive fiscal policies

2.

States receive most of their intergovernmental revenue funds from

a)

other states

b)

local governments

c)

taxes

d)

federal government

3.

The terms proportional, regressive, and progressive refer to _____

a)

principles of taxation

b)

criteria for effective taxes

c)

types of taxes

d)

benefit principle

4.

The FICA deduction taken from your paycheck is

a)

Social Security and Medicare

b)

Medicare and sales tax

c)

Medicare and tax loopholes

d)

sales tax and flat tax

5.

Which of the following is one of the three functions of money?

a)

store of value

b)

scarcity

c)

divisibility

d)

portability

6.

an institution that oversees and regulates the banking system and controls the monetary base

a)

Board of Governors

b)

central bank

c)

open market committee

d)

monetary policy

7.

Oversees the entire banking system, 7 members appointed by the president and approved by the Senate; serve 14 year terms

a)

Board of Governors

b)

open market committee

c)

Federal Reserve

d)

FDIC

8.

The fraction of bank deposits that a bank holds as reserves.

a)

balance sheet effect

b)

reserve requirement

c)

discount rate

d)

monetary policy

9.

The discount rate is ______

a)

the interest rate banks pay to other banks to balance their overnight funds

b)

the interest rate the Fed charges on loans to banks

c)

the interest rate paid by customers to the Fed

d)

none of these is correct

10.

Which of these exerts the most direct control over interest rates?

a)

the Board of Governors

b)

the Federal Reserve district banks

c)

The Federal Open Market Committee

d)

the Consumer Financial Protection Bureau

11.

Which of these is a feature of open market operations?

a)

The Fed sells government securities

b)

The Fed lowers the prime interest rate

c)

The Fed raises the reserve requirement

d)

The Fed purchases member bank reserves

12.

Who appoints members of the Fed's Board of governors?

a)

the President

b)

House of Representatives

c)

Senate

d)

Chair of the Board of Governors