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Monetary Policy Quiz (Ch 16 and some 14, 15)

Total questions: 17

Worksheet time: 9mins

Name
Class
Date
1.

the actions the Federal Reserve takes to influence the level of real GDP and the rate of inflation in the economy

a)

monetary policy

b)

fiscal policy

c)

open market operations

d)

monetarism

2.

the twelve banking districts created by the Federal Reserve Act

a)

Federal Reserve Districts

b)

Federal Advisory Council (FAC)

c)

required reserve ratio (RRR)

d)

tight money policy

3.

the research arm of the Federal Reserve

a)

Federal Reserve Council (FAC)

b)

Federal Open Market Committee (FOMC)

c)

money multiplier formula

d)

easy money policy

4.

Federal Reserve committee that makes key decisions about interest rates and the growth of the United States money supply

a)

Federal Open Market Committee (FOMC)

b)

Federal Advisory Council (FAC)

c)

Federal Reserve Districts

d)

open market operations

5.

ratio of reserves to deposits required of banks by the Federal Reserve

a)

required reserve ratio (RRR)

b)

monetary policy

c)

fiscal policy

d)

monetarism

6.

amount of new money that will be created with each demand deposit, calculated as 1/RRR

a)

money multiplier formula

b)

required reserve ration (RRR)

c)

easy money policy

d)

tight money policy

7.

the buying and selling of government securities to alter the supply of money

a)

open market operations

b)

monetary policy

c)

monetarism

d)

Federal Advisory Council (FAC)

8.

the belief that the money supply is the most important factor in macroeconomic performance

a)

monetarism

b)

monetary policy

c)

fiscal policy

d)

easy money policy

9.

monetary policy that increases the money supply

a)

easy money policy

b)

tight money policy

c)

Federal Open Market Committee (FOMC)

d)

Federal Reserve Districts

10.

monetary policy that reduces the money supply

a)

tight money policy

b)

easy money policy

c)

monetary policy

d)

required reserve ratio (RRR)

11.

the use of government spending and revenue collection to influence the economy

a)

fiscal policy

b)

monetary policy

c)

classical economics

d)

supply-side economics

12.

the idea that free markets can regulate themselves

a)

classical economics

b)

Keynesian economics

c)

monetary policy

d)

national debt

13.

a form of demand-side economics that encourages government action to increase or decrease demand and output

a)

Keynesian economics

b)

supply-side economics

c)

classical economics

d)

budget surplus

14.

a tax on the dollar value of a good or service being sold

a)

sales tax

b)

gift tax

c)

estate tax

d)

excise tax

15.

a tax for which the percentage of income paid in taxes increases as income increases

a)

progressive tax

b)

regressive tax

c)

proportional tax

d)

property tax

16.

spending on certain programs that is mandated, or required, by existing law

a)

mandatory spending

b)

discretionary spending

c)

operating budget

d)

capital budget

17.

spending category about which government planners can make choices

a)

discretionary spending

b)

mandatory spending

c)

operating budget

d)

capital budget