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ID: 1107604 • Letter: H
Question
home / study / business / economics / economics questions and answers / question 1 (1 point) social security and medicare are con
Question 2 (1 point)
Which one of the following is a reason the crowding-out effect could be mitigated?
Question 2 options:
a)
an increase in consumer consumption
b)
a decrease in tax revenues
c)
an increase in the saving rate
d)
deficit spending used for public investment
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Question 3 (1 point)
If the ultimate goal of fiscal policy aimed at aggregate supply is achieved, what happens to the aggregate price level and aggregate output?
Question 3 options:
a)
aggregate price level increases; aggregate output decreases
b)
aggregate price level decreases; aggregate output increases
c)
aggregate price level increases; aggregate output increases
d)
aggregate price level decreases; aggregate output decreases
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Question 4 (1 point)
If a government collects $550 billion in taxes and spends $700 billion, it would have a:
Question 4 options:
a)
surplus of $1,250 billion.
b)
deficit of $150 billion.
c)
deficit of $1,250 billion.
d)
surplus of $150 billion.
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Question 5 (1 point)
What did Arthur Laffer suggest President Reagan do in the 1980s?
Question 5 options:
a)
decrease income taxes
b)
increase corporate taxes
c)
increase welfare benefits
d)
increase income taxes
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Question 6 (1 point)
The fact that it takes a very long time for Congress to debate and enact fiscal policies such as a tax cut for low-income households is an example of a(n):
Question 6 options:
a)
decision lag.
b)
implementation lag.
c)
recognition lag.
d)
information lag.
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Question 7 (1 point)
The most important measure in determining whether a country's national debt is a significant problem is:
Question 7 options:
a)
the size of the debt in nominal terms.
b)
the proportion of the national debt that is held by government agencies.
c)
interest paid on the national debt as a portion of GDP.
d)
the interest rate paid on the debt.
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Question 8 (1 point)
If the national debt is $55 million and this year's deficit is $5 million, what would the new national debt be?
Question 8 options:
a)
$50 million
b)
$11 million
c)
$60 million
d)
$275 million
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Question 9 (1 point)
All of the following programs are considered mandatory spending EXCEPT:
Question 9 options:
a)
Social Security.
b)
interest on national debt.
c)
national defense.
d)
Medicare.
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Question 10 (1 point)
Suppose the government collected $3.2 trillion in tax revenues and spent $3.8 trillion, and discretionary spending was $1.5 trillion. For the government to fully balance the budget this year, how much discretionary spending needs to be cut?
Question 10 options:
a)
20%
b)
40%
c)
30%
d)
10%
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Question 11 (1 point)
Evidence has suggested that borrowing is _____ than taxation by politicians to finance fiscal policy spending, which has led to a(n) _____ of the federal government over the last few decades.
Question 11 options:
a)
more favored; contraction
b)
less favored; contraction
c)
more favored; expansion
d)
less favored; expansion
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Question 12 (1 point)
Reducing government spending, reducing transfer payments, or raising taxes describes which policy?
Question 12 options:
a)
contractionary fiscal policy
b)
expansionary fiscal policy
c)
monetary policy
Explanation / Answer
Answer 2. c) an increase in the saving rate
Answer 3. b) aggregate price level decreases; aggregate output increases
Answer 4. b) deficit of $150 billion.
Answer 5. a) decrease income taxes
Answer 6. a) decision lag.
Answer 7. c) interest paid on the national debt as a portion of GDP.
Answer 8. $60 million
Answer 9. c) national defense.
Answer 10. b) 40%
Answer 11. d) less favored; expansion
Answer 12. a) contractionary fiscal policy
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