AnswersFL-2102340-Economics with Financial Literacy Teacher DirectedFiscal Policy: Spending

Fiscal Policy: Spending Answers

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A graph shows the Total Public Debt of the U S Government from 1993 to 2013 with Year on the x-axis and Total public debt in trillions of U S dollars on the y-axis, from 0 to 20 in increments of 5. The debt stays constant from 1993 to 2001 and then steadily increases.

Question illustration
A
It is increasing.
B
It has leveled off.
C
It is decreasing.
D
It has not changed.
2
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A pie chart titled Federal Government Spending in 2010 is shown. Education and health and human services has the largest piece, and veteran apostrophe s affairs has the smallest piece.

Question illustration
l
labor and transportation
v
veterans' affairs
e
education/health and human services
i
international assistance
3

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

d
deciding which country to borrow from to finance spending
d
deciding what would be funded and what would be cut
d
deciding how to keep interest rates low on the national debt
d
deciding how much to increase tax rates
4

A plan for spending money that balances income with spending and shows how money will be spent is

a
a surplus.
a
an expenditure.
a
a budget.
a
a deficit.
5

What does deficit spending require a government to do?

l
lay off workers
c
cut taxes
t
take on debt
h
hire more workers
6

A flow chart shows an aspect of fiscal policy. Money goes from the government, to household, and to firms.

Question illustration
A
the way in which a government creates a budget
B
a budget that is severely unbalanced
C
government spending to strengthen the economy
D
ways in which governments spend money
7

What is the main goal in creating the federal budget?

A
managing businesses and increasing spending on all programs
B
deciding how to manage the government’s tax revenue and expenditures
C
finding a way to allow the economy to run on its own
D
finding a way to slow down rapid economic growth
8

When a government creates a budget, it is seeking a way to

s
spend as much revenue as possible.
c
cut spending to a bare minimum.
r
return as much money to taxpayers as possible.
a
allocate money to programs and projects.
9

A diagram shows that taxes go into the government, which then go into spending.

Question illustration
G
Government Spending
T
The National Economy
T
The Federal Debt
F
Fiscal Policy
10

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

M
Millions of Americans work for the federal government.
T
The federal government is not allowed to hire employees.
T
The majority of Americans are employed by the federal government.
T
The number of federal employees is too small to affect government spending.
11

A flow chart shows an aspect of fiscal policy. Money goes from the government, to household, and to firms.

Question illustration
A
the way in which a government creates a budget
B
a budget that is severely unbalanced
C
government spending to strengthen the economy
D
ways in which governments spend money
12

A plan for spending money that balances income with spending and shows how money will be spent is

A
a surplus.
B
an expenditure.
C
a budget.
D
a deficit.
13

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

A
Millions of Americans work for the federal government.
B
The federal government is not allowed to hire employees.
C
The majority of Americans are employed by the federal government.
D
The number of federal employees is too small to affect government spending.
14

What is the main goal in creating the federal budget?

A
managing businesses and increasing spending on all programs
B
deciding how to manage the government’s tax revenue and expenditures
C
finding a way to allow the economy to run on its own
D
finding a way to slow down rapid economic growth
15

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

A
It can increase unemployment and reduce inflation.
B
It can increase unemployment and inflation.
C
It can reduce unemployment but lower inflation.
D
It can reduce unemployment but increase inflation.
16

When a government creates a budget, it is seeking a way to

A
spend as much revenue as possible.
B
cut spending to a bare minimum.
C
return as much money to taxpayers as possible.
D
allocate money to programs and projects.
17

What does deficit spending require a government to do?

A
lay off workers
B
cut taxes
C
take on debt
D
hire more workers
18

A pie chart titled Federal Government Spending in 2010 is shown. Education and health and human services has the largest piece, and veteran apostrophe s affairs has the smallest piece.

Question illustration
A
labor and transportation
B
veterans' affairs
C
education/health and human services
D
international assistance
19

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?

A
The policy would most likely increase interest rates and unemployment.
B
The policy would most likely decrease interest rates and unemployment.
C
The policy would most likely increase unemployment but decrease interest rates.
D
The policy would most likely increase interest rates but decrease unemployment.
20

A diagram shows that taxes go into the government, which then go into spending.

Question illustration
A
Government Spending
B
The National Economy
C
The Federal Debt
D
Fiscal Policy

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