#1
Which of the following is a fiscal policy tool used to stimulate economic growth?
Increasing government spending
Raising interest rates
Reducing money supply
Decreasing taxes
#2
What is the primary objective of monetary policy?
Controlling inflation and unemployment
Stabilizing exchange rates
Regulating government spending
Managing trade deficits
#3
What is the name of the index that measures the average prices of consumer goods and services?
GDP deflator
Consumer Price Index (CPI)
Producer Price Index (PPI)
Inflation rate index
#4
What is the term for the situation where the economy is operating at full employment with stable prices?
Recession
Peak
Equilibrium
Expansion
#5
Which of the following is a tool of fiscal policy?
Open market operations
Setting reserve requirements
Adjusting the discount rate
Changing government spending
#6
Which of the following is a characteristic of expansionary fiscal policy?
Decreasing government spending
Raising taxes
Reducing budget deficits
Increasing aggregate demand
#7
What is the name of the central bank of the United States?
Bank of America
Federal Reserve
Wells Fargo
Goldman Sachs
#8
What is the name of the economic theory that suggests government intervention in the economy can stabilize it?
Monetarism
Keynesian economics
Austrian economics
Supply-side economics
#9
Which of the following is an example of an automatic stabilizer in fiscal policy?
Unemployment insurance
Tax cuts
Infrastructure spending
Bailouts for corporations
#10
Which of the following is a characteristic of contractionary monetary policy?
Decreasing interest rates
Buying government securities
Increasing money supply
Encouraging borrowing and spending
#11
Which of the following is NOT a tool of monetary policy?
Open market operations
Discount rate
Government spending
Reserve requirements
#12
What does the term 'stagflation' refer to in economics?
A period of high inflation and low economic growth
A period of economic expansion without inflation
A period of deflation and recession
A situation where the economy is neither growing nor shrinking
#13
Which of the following is a disadvantage of using expansionary fiscal policy during a recession?
It may lead to higher inflation
It reduces government debt
It lowers interest rates
It decreases consumer spending
#14
In the context of monetary policy, what does the term 'quantitative easing' refer to?
Decreasing interest rates to stimulate borrowing
Increasing government spending to boost demand
Selling government securities to reduce the money supply
Buying government securities to increase the money supply
#15
Which of the following is a characteristic of a recessionary gap?
Aggregate demand exceeds aggregate supply
Aggregate supply exceeds aggregate demand
The economy is operating at full employment
There is no gap between aggregate demand and aggregate supply