Answers26-27 Ignite Economics-KY-EconomicsInflation and Stagflation (continued)

Inflation and Stagflation (continued) — Unit test Answers

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21
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Expansionary spending takes place when a government makes the decision to

A
put a freeze on the number of its employees.
B
raise taxes to balance its budget.
C
raise taxes to run a budget surplus.
D
raise spending to stimulate the economy.
22
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A business owner would most likely create a cooperative instead of buying a franchise because

A
cooperatives give majority owners the most control, while franchises make decisions with a parent company.
B
cooperatives make it easy to accumulate supplies, while franchises come with supplier relationships already in place.
C
cooperatives are well financed by members, while franchises must raise large sums of money to launch a business.
D
cooperatives allow all owners to share profits, while franchises are required to share profits with a parent company.
23

Which of these are goals of an expansionary policy? Check all that apply.increased available creditdecreased available creditincreased money supplyincreased inflationincreased interest ratesdecreased interest rates

A
increased available credit
B
decreased available credit
C
increased money supply
D
increased inflation
E
increased interest rates
F
decreased interest rates
24

Which best describes a regressive tax?

A
a tax that charges low-income earners a lower percentage than high-income earners
B
a tax that charges an equal percentage to all
C
a tax that charges earners based on their professions
D
a tax that charges high-income earners a lower percentage than low-income earners
25

Which of the following are taxes on income or wealth that individuals pay in the United States? Select three options.

A
property tax on a home
B
income earned from wages
C
sales tax on clothing
D
excise tax on gasoline
E
profits from investments

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Inflation and Stagflation (continued) — Unit…