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Fiscal and Monetary Test Review Flashcards | StudBud
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Fiscal and Monetary Test Review
Fiscal and Monetary Test Review
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1
Which of the following is NOT a reason why the fed was formed?
All of the following are reasons why the fed was formed
Setting nation’s monetary policy
Centralized national authority
Regional independence
2
A tax on imported goods is called…
Tariff
Excise tax
Unemployment tax
Social security tax
3
What tool of monetary policy describes the Fed buying and selling bonds?
Reserve requirements
Open market operations
Federal funds rate
Discount rate
4
What tool of monetary policy tells the banks how much money they must have at all times?
Reserve requirements
Federal funds rate
Discount rate
Open market operations
5
What is the ultimate goal of the Federal Reserve?
To allow hyperinflation to exist
To control the import-export rate
To keep the discount rate low
To fight inflation and keep price stability
6
What tool of monetary policy tells the banks how much money they must have at all times?
Discount rate
Federal funds rate
Reserve requirements
Open market operations
7
What type of economist believes that the government can be a stabilizing force on supply?
Keynesian economist
Supply-side economist
none of the above
Classical economist
8
What law created the federal reserve system?
Sherman Antitrust Act
Social Security Act
Appropriations Act
Federal Reserve Act
9
Which Branch of the government is responsible for creating the federal budget?
Executive Branch
none of the above
Legislative Branch
Judicial Branch
10
Which of the following government actions is an example of contractionary policy?
Raising taxes
Cutting taxes
Increasing government spending
none of the above
11
Federal taxes must be the same in every state
True
False
12
A general revenue tax on the sale or manufacture of a good is called...
Medicare tax
Gift tax
Excise tax
Estate tax
13
Which of the following is a way economists describe taxes?
How a tax is created in Congress
What is being taxed
What a taxed is named
none of the above
14
What tool of monetary policy tells the banks how much money they must have at all times?
Reserve requirements
Federal funds rate
Open market operations
Discount rate
15
Which of the following is not a part of the Federal Reserve system?
Reserve Banks
U.S. Department of Treasury
Board of Governors
Federal Open Market Committee
16
What is the interest rate on loans between banks called?
Discount Rate
Annual Percentage Rate
Direct Rate
Federal Funds Rate
17
What type of tax increases based on the amount of income a person makes?
none of the above
Regressive tax
Progressive tax
Proportional tax
18
The federal funds rate is always higher than the discount rate
False
True
19
Which principle of tax fairness states that people should pay taxes according to their ability to pay?
Benefits received principle
Proportional benefits principle
Ability to pay principle
Progressive pay principle
20
Which principle of tax fairness states that people should pay taxes according to their ability to pay?
Proportional benefits principle
progressive pay principle
Benefits received principle
Ability to pay principle
21
One of the characteristics of a tax is that the tax should be simple and easily understood; what is this called?
Certainty
Equity
Efficiency
Simplicity
22
Which of the following government actions is an example of expansionary policy?
Both A and C
Raising taxes
Cutting taxes
Increasing government spending
23
The use of government spending and revenue collection to influence the economy is called…
Discretionary spending
Monetary policy
Money supply
Fiscal policy
24
What type of economist believes that the government can be a stabilizing force on demand?
Supply-side economist
Classical economist
none of the above
Keynesian economist
25
The more elastic the demand, the more the seller bears the burden of a tax
False
True
26
One of the characteristics of a tax is that the tax should be simple and easily understood; what is this called?
Certainty
Simplicity
Equity
Efficiency
27
What tool of monetary policy describes the Fed buying and selling bonds?
Reserve requirements
Discount rate
Federal funds rate
Open market operations
28
Which of the following government actions is an example of contractionary policy?
Increasing government spending
none of the above
Cutting taxes
Raising taxes
29
In the federal budget, which type of spending must occur due to current laws?
Alternative spending
Discretionary spending
Mandatory spending
Priority spending
30
What type of economist believes that the government can be a stabilizing force on demand?
Keynesian economist
Supply-side economist
None of the above
Classical economist
