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Mac11: Fiscal policy, tools, deficit spending, national debt

Last updated about 6 years ago

5 questions

1

1

1

1

1

Question 1

1.

Which of the following tools are part of fiscal policy?

Open Market Operations

Government spending

Reserve requirement

Discount rate

Taxes

Interest on reserves

Question 2

2.

Fiscal policy is conducted by what government agency?

Justice Department

Federal Reserve

Treasury Department

Congress

Question 3

3.

When the economy is in recession which combination of fiscal policy tools would be appropriate?

raise taxes and decrease government spending

Buy bonds/securities and lower taxes

lower taxes and increase government spending

Sell bonds/securities and raise the reserve requirement

Question 4

4.

When the federal government spends more than it receives in tax revenues for a given year, the result is called:

a Budget deficit

a Balanced budget

a Budget surplus

a Budget correction

Question 5

5.

An increase in budget deficits from year to year will cause the national debt to grow larger.

True

False