This quiz works best with JavaScript enabled. Home > Finance > Economics > Macroeconomics > Monetary And Fiscal Policy > Monetary And Fiscal Policy – Quiz 7 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Monetary And Fiscal Policy Quiz 7 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Per capita income of Malaysian citizen rises. A) Microeconomics. B) Macroeconomics. Show Answer Correct Answer: B) Macroeconomics. 2. Which market structure involves selling identical products? A) Oligopoly. B) Perfect Competition. C) Monopolistic Competition. D) Monopoly. Show Answer Correct Answer: B) Perfect Competition. 3. The Federal Reserve is an independent central bank. A) True. B) False. Show Answer Correct Answer: A) True. 4. Use the scenario to answer the following question. In 2020 families across the United States received stimulus payments from the government. This helped families pay bills and support businesses during the economic crisis caused by the COVID-19 pandemic. Which economic policy is being described in the scenario? A) Supply-side policy. B) Trade policy. C) Fiscal policy. D) Monetary policy. Show Answer Correct Answer: C) Fiscal policy. 5. The amount that all banks have to keep in the reserve and they can't loan out to people A) Lending policy. B) Reserve requirement. C) Fiscal spending. D) Monetary lending. Show Answer Correct Answer: B) Reserve requirement. 6. Which policy is the following statement associated with? "The 2013 government budget included job-creation initiatives for infrastructure, job-training and innovation" . To offset the cost, it "called for raising $ 1.5 trillion over 10 years from the wealthiest taxpayers by closing some corporate tax breaks, chiefly for oil and gas companies." A) Monetary Policy. B) Fiscal Policy. C) Both Monetary and Fiscal Policy. D) None of above. Show Answer Correct Answer: B) Fiscal Policy. 7. Taxing and Spending are tools of A) Monetary Policy. B) Fiscal Policy. Show Answer Correct Answer: B) Fiscal Policy. 8. This type of tax takes a higher percentage of income the more money you make A) Regressive. B) Flat. C) Progressive. D) Proportional. Show Answer Correct Answer: C) Progressive. 9. The lifespan of a $ 1 bill is: A) 1 years. B) 2 years. C) 6 years. D) 4.8 years. Show Answer Correct Answer: D) 4.8 years. 10. Unemployment is 10%. What is the problem in the economy? A) Recession. B) CPI is growing too fast. C) Debt. D) Inflation. Show Answer Correct Answer: A) Recession. 11. Fiscal Policy describes A) Government spending and taxation. B) Consumer spending and productivity. C) Government spending and the money supply. D) Taxation and inflation. Show Answer Correct Answer: A) Government spending and taxation. 12. A period of time when recovering from a recession? A) Peak. B) Trend line. C) Trough. D) Expansion. Show Answer Correct Answer: D) Expansion. 13. Which of the following is considered to be contractionary fiscal policy? A) Congress increases defense spending. B) The New Jersey legislature cuts highway spending to balance its budget. C) Legislation removes a college tuition deduction from federal income taxes. D) Congress increases the income tax rate. Show Answer Correct Answer: D) Congress increases the income tax rate. 14. The branch of the US Treasury in charge of taxes is the ..... A) FBI. B) IRS. C) DNA. D) CIA. Show Answer Correct Answer: B) IRS. 15. What is the role of interest rates in monetary policy? A) Interest rates have no impact on the money supply. B) Interest rates are only used for controlling inflation. C) Interest rates are used to control the money supply and influence economic activity. D) Interest rates have no effect on economic activity . Show Answer Correct Answer: C) Interest rates are used to control the money supply and influence economic activity. 16. When you buy a government bond, you ..... A) Loan money to the government. B) Borrow money from a savings and loan. C) Donate money for special government projects. D) Pay for your child's education. Show Answer Correct Answer: A) Loan money to the government. 17. Which is NOT an example of pork barreling? A) $ 2 billion on Veteran's affairs. B) $ 18 million to redesign a government website. C) $ 1.2 million to study the breeding habits of a woodchuck. D) $ 144, 000 to see if pigeons follow human economic laws. Show Answer Correct Answer: A) $ 2 billion on Veteran's affairs. 18. To help the economy grow, the government can A) Decrease spending. B) Lower the minimum wage. C) Raise taxes. D) Increase spending. Show Answer Correct Answer: D) Increase spending. 19. The buying and selling of government securities is which tool of the Federal Reserve? A) Open Market Operations. B) Discount Rate. C) Reserve Requirements. D) None of above. Show Answer Correct Answer: A) Open Market Operations. 20. Herbert Hoover was a believer in this type of Economics A) Supply-side. B) Classical. C) Keynesian. D) Demand-Side. Show Answer Correct Answer: B) Classical. 21. How much must the bank keep on hand if the Required Reserve is 10% and there is a deposit of $ 100. A) 90. B) 10. C) 110. D) 100. Show Answer Correct Answer: B) 10. 22. Inflation is a sustained increase in the general level of ..... A) Accounts. B) Profit. C) Prices. D) Income. Show Answer Correct Answer: C) Prices. 23. What did not cause the national debt to rise under President Reagan: A) War Spending. B) Increased defense spending. C) Tax Cuts. D) Economic Downturn. Show Answer Correct Answer: A) War Spending. 24. If the government is concerned about unemployment, which fiscal policy tool would they use? A) Increase government spending. B) Increase reserve requirement to decrease the money supply. C) Increase income taxes. D) Increase discount rate to decrease the money supply. Show Answer Correct Answer: A) Increase government spending. 25. Makes Monetary Policy. A) President. B) Bank CEOs. C) The Federal Open Market Committee. D) Congress. Show Answer Correct Answer: C) The Federal Open Market Committee. 26. Congress cutting taxes is an example of ..... A) Monetary Policy. B) Fiscal Policy. Show Answer Correct Answer: B) Fiscal Policy. 27. Impact of Fiscal Policy A) Can create jobs, increase wages, cause inflation or deflation, and motivate consumer spending. B) Controls rates on loans for houses, cars, education, etc. Show Answer Correct Answer: A) Can create jobs, increase wages, cause inflation or deflation, and motivate consumer spending. 28. There are 15 Federal Reserve Districts A) True. B) False, there are 12 districts. C) False, there are 20 Districts. D) False, there are 9 districts. Show Answer Correct Answer: B) False, there are 12 districts. 29. Contractionary monetary policy on the part of the Fed results in A) An increase in the money supply, an increase in interest rates, and an increase in GDP. B) A decrease in money supply, a decrease in interest rates, and a decrease in GDP. C) A decrease in the money supply, an increase in interest rates, and a decrease in GDP. D) An increase in the money supply, a decrease in interest rates, and an increase in GDP. Show Answer Correct Answer: C) A decrease in the money supply, an increase in interest rates, and a decrease in GDP. 30. An increase in government spending or a reduction in taxes A) Fiscal policy. B) Contractionary policy. C) Expansionary policy. D) Monetary policy. Show Answer Correct Answer: C) Expansionary policy. ← 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 8Monetary And Fiscal Policy Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books