AnswersLVA-Economics SPRINGIntroduction to Economics

Economic Policy Answers

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1
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A government's monetary policy is its plan to control

A
taxation and spending.
B
prices.
C
workers' wages.
D
the money supply.
2
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In a free enterprise system, what are the goals of government? Check all that apply.

A
to ensure safety for its citizens
B
to ensure that citizens' needs are met
C
to stay out of all economic decisions
D
to solve the problem of poverty
E
to prevent citizens from getting rich
F
to ensure that the market is fair
3

What are economic challenges that governments must face? Check all that apply.

A
threats of war
B
unemployment
C
low production
D
inflation
E
low voter turnout
4

The graph shows the number of employed workers in the United States in nonfarm jobs from 2008 to 2013.

Question illustration
A
reducing the size of its armed forces
B
laying off unnecessary workers
C
decrease taxes to increase consumers' money supply
D
encouraging people to travel overseas
5

What is a primary economic goal of governments?

A
reducing income inequality
B
maximizing individual freedoms
C
advancing technological innovation
D
protecting natural resources
6

Which of these policies would a government take when it comes to employment?

A
paying government employee when they choose to not work
B
seeing that at least a quarter the workforce has a job
C
working toward making unemployment is as low as possible
D
making sure that only skilled workers get jobs
7

Country Q has experienced a rapid increase in its unemployment rate and a sharp decline in its GDP.What might policymakers do in the face of these economic indicators?

A
encourage a decrease in purchasing until employment figures increase
B
try to trade with other nations to increase production and create new jobs
C
increase taxes so the government has more money to spend
D
implement controls on wages, forcing employers to pay higher wages
9

Rules ensuring that businesses offer safe products to consumers are part of a nation's

A
trade policy.
B
monetary policy.
C
regulatory policy.
D
fiscal policy.

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Economic Policy Answers — LVA-Economics SPRING