Fiscal Policy: Spending

Question 1

A graph shows the U S Government and Expenditures from 1980 to 2010. The money spent and money received generally follow the same trend, but around 2008, the amount of money spent increased and money received decreased.

Revolt · Accepted Answer

Lines seldom overlap showing a mostly unbalanced budget.

Question 2

Which statement best describes the likely effects of an expansionary fiscal policy?

Revolt · Accepted Answer

It can reduce interest rates and unemployment, but increase inflation.

Question 3

What is the main goal in creating the federal budget?

Revolt · Accepted Answer

deciding how to manage the government’s tax revenue and expenditures

Question 4

Which of the following statements most accurately describes the federal government and its employees?

Revolt · Accepted Answer

Millions of Americans work for the federal government.

Question 5

Spending that is required by law is known as

Revolt · Accepted Answer

mandatory spending.

Question 6

What does deficit spending require a government to do?

Revolt · Accepted Answer

take on debt

Question 7

"Meeting the spending targets in this budget meant some very difficult choices."President Barack Obama,2012 Budget Message of the President

Revolt · Accepted Answer

deciding what would be funded and what would be cut

Question 8

Gino is writing a paper about the effects of fiscal policies on the economy. Gino is describing a fiscal policy that aims to improve inflation.How does the policy that Gino is describing most likely affect interest rates and unemployment?

Revolt · Accepted Answer

The policy would most likely increase interest rates and unemployment.

Question 9

Which of these effects of expansionary spending would a government most want to avoid?

Revolt · Accepted Answer

higher inflation

Question 10

When revenues are higher than expenditures in a budget, that budget

Revolt · Accepted Answer

shows a surplus.

Fiscal Policy: Spending Answers

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