This quiz works best with JavaScript enabled. Home > Economics > Macroeconomics > Monetary And Fiscal Policy > Monetary And Fiscal Policy – Quiz 21 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Monetary And Fiscal Policy Quiz 21 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Finish the statement:Monetary policy affects the ....., primarily through changing ..... A) Money supply, interest rates. B) Budget, fiscal policy. C) Interest rates, reserve requirement. D) Federal Reserve, printing money. Show Answer Correct Answer: A) Money supply, interest rates. 2. Who is the chairman of the Federal Reserve? A) Janet Yellen. B) Jerome Powell. C) John G. Roberts. D) Mike Pence. Show Answer Correct Answer: B) Jerome Powell. 3. Which of the following is NOT one of the characteristics of money A) Limited Supply. B) Durable. C) Portable. D) Medium of Exchange. Show Answer Correct Answer: D) Medium of Exchange. 4. The goals of monetary policy do NOT include the promotion of ..... A) Moderate long-term interest rates. B) Stable prices. C) Maximum employment. D) High government spending. Show Answer Correct Answer: D) High government spending. 5. If inflation reaches 5% which of the following is true A) Want to increase the money supply. B) Decrease government spending. C) Decrease reserve requirement. D) Buy bonds. Show Answer Correct Answer: B) Decrease government spending. 6. What is medium of exchange? A) A means of payment. B) Legal tender. C) Gives value to object. D) M1. Show Answer Correct Answer: A) A means of payment. 7. When banks borrow money from the FED, their reserves A) Increase. B) Decrease. Show Answer Correct Answer: A) Increase. 8. Which of the following is NOT an objective of monetary policy A) Inflation between 2-3%. B) Full employment. C) Equal distribution of income. D) Economic prosperity. Show Answer Correct Answer: C) Equal distribution of income. 9. Metallic forms of money such as pennies, nickles, dimes, and quarters. A) Coins and currency. B) Currency. C) Coins. D) Debit cards. Show Answer Correct Answer: C) Coins. 10. Contractionary policy tries to fix the problem of ..... A) Stagflation. B) Demand-pull inflation. C) Cost-push inflation. D) Success. Show Answer Correct Answer: B) Demand-pull inflation. 11. The general increase of price levels? A) Inflation. B) Deflation. C) Consumer price index. D) Aggregate demand. Show Answer Correct Answer: A) Inflation. 12. Federal Funds Rate A) The interest rate at which a depository institution lends funds that are immediately available to another depository institution overnight. B) The federal reserve's responsibility to use monetary policy to promote maximum employment and price stability. C) Limit set on the government regarding how much they can borrow. D) Interest rate on house mortgage. Show Answer Correct Answer: A) The interest rate at which a depository institution lends funds that are immediately available to another depository institution overnight. 13. The goal of contractionary fiscal or monetary policy is A) To decrease unemployment and increase economic growth. B) To increase inflation. C) To decrease inflation. D) To increase unemployment and decrease economic growth. Show Answer Correct Answer: C) To decrease inflation. 14. Which of these would be the appropriate use of Fiscal and Monetary Policy to correct recession? A) Buy bonds and raise government spending. B) Sell bonds and raise government spending. C) Raise interest rate and raise taxes. D) Raise interest rate and lower taxes. Show Answer Correct Answer: A) Buy bonds and raise government spending. 15. When interest rates are high A) People and businesses buy less and save more. B) People and businesses buy more and save less. C) People and businesses do not change their behavior. D) None of above. Show Answer Correct Answer: A) People and businesses buy less and save more. 16. The process of banks recording whose account gives up and whose account receives money when a customer writes a check is called A) Check Cashing. B) Check Clearing. C) Check Cycle. D) None of the Above. Show Answer Correct Answer: B) Check Clearing. 17. Budget deficit is a condition when expenditures is higher than revenue A) True. B) False. Show Answer Correct Answer: A) True. 18. ..... is the largest category of mandatory spending, and ..... is the largest category of discretionary spending. A) Defense / social security. B) Medicare / defense. C) Medicaid / social security. D) Social security / defense. Show Answer Correct Answer: D) Social security / defense. 19. What is one tool that measures the rate of inflation? A) GDP. B) Federal Reserve. C) Unemployment. D) Consumer price index. Show Answer Correct Answer: D) Consumer price index. 20. The organization responsible for the monetary policy of the United States is A) Congress. B) Federal Reserve. C) Treasury Department. D) Executive Department. Show Answer Correct Answer: B) Federal Reserve. ← PreviousNext →Related QuizzesMacroeconomics QuizzesEconomics QuizzesMonetary And Fiscal Policy Quiz 1Monetary And Fiscal Policy Quiz 2Monetary And Fiscal Policy Quiz 3Monetary And Fiscal Policy Quiz 4Monetary And Fiscal Policy Quiz 5Monetary And Fiscal Policy Quiz 6Monetary And Fiscal Policy Quiz 7Monetary And Fiscal Policy Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books