#1
During an economic crisis, what is the primary goal of government intervention?
Maximize corporate profits
Minimize unemployment and stabilize the economy
Increase taxes on citizens
Encourage inflation
#2
Which factor is NOT a common indicator of an economic crisis?
Rapid inflation
Sudden increase in consumer spending
Sharp decline in GDP
Unemployment surge
#3
What is the term for a prolonged period of economic decline, often characterized by high unemployment, stagnant wages, and low consumer confidence?
Economic boom
Economic recession
Economic depression
Economic expansion
#4
What is the term for a sudden and severe decline in the value of a currency relative to other currencies?
Currency devaluation
Currency appreciation
Currency stabilization
Currency pegging
#5
Which of the following is NOT a typical measure taken by governments during an economic crisis?
Increasing public spending
Lowering interest rates
Implementing austerity measures
Reducing taxes for high-income individuals
#6
What is quantitative easing (QE) in the context of government intervention during an economic crisis?
Reducing government regulations on businesses
Increasing taxes on imports
Buying government securities to inject money into the economy
Implementing price controls on essential goods
#7
Which of the following is a potential consequence of excessive government intervention during an economic crisis?
Stimulating economic growth
Creating long-term structural problems
Decreasing income inequality
Reducing government debt
#8
What is the 'lender of last resort' role typically performed by central banks during an economic crisis?
Providing loans to high-income individuals
Assisting struggling businesses with grants
Offering emergency liquidity to financial institutions
Supporting government deficit spending
#9
Which of the following is NOT a measure typically used to gauge the severity of an economic crisis?
Stock market performance
Consumer confidence index
Government bond yields
Corporate tax rates
#10
Which economic theory advocates for minimal government intervention during an economic crisis?
Keynesian economics
Monetarism
Classical economics
Supply-side economics
#11
What role does fiscal policy play in government intervention during an economic crisis?
Regulating the money supply
Controlling inflation through interest rates
Manipulating government spending and taxation
Intervening in foreign exchange markets
#12
What is the term for the situation where the collapse of one financial institution triggers the collapse of other interconnected institutions, leading to a broader financial meltdown?
Systemic risk
Market saturation
Monopoly effect
Fiscal cliff
#13
Which of the following is a characteristic of a liquidity trap?
High interest rates
Low consumer spending
Excessive inflation
Increased borrowing by businesses
#14
In the context of economic crises, what is 'moral hazard'?
The tendency for individuals to engage in risky behavior when insulated from its consequences
The belief that economic downturns are primarily caused by unethical business practices
The concept of fairness in income distribution during times of economic distress
The notion that government intervention always leads to positive outcomes