#1
Which of the following is a source of revenue for the government?
Income tax
ExplanationTax on individuals' earnings.
#2
What does GDP stand for in economics?
Gross Domestic Product
ExplanationTotal value of goods and services produced within a country.
#3
What is the term used to describe a situation where the government spends more money than it collects in revenue?
Budget deficit
ExplanationShortfall in government funds.
#4
Which of the following is a function of the Federal Reserve System in the United States?
Regulating commercial banks
ExplanationOversees banking operations.
#5
Which of the following is NOT a component of monetary policy?
Government spending
ExplanationNot directly controlled by central bank.
#6
What is the purpose of fiscal policy?
To manage government revenue and expenditure
ExplanationGovernment's strategy for revenue and spending.
#7
Which of the following is a characteristic of a progressive tax system?
Lower income individuals pay a higher percentage of their income in taxes
ExplanationTax burden increases with income.
#8
What is the main function of the Securities and Exchange Commission (SEC) in the United States?
Regulating the stock market and protecting investors
ExplanationEnsures fair and transparent markets.
#9
Which of the following is NOT considered a component of government expenditure?
Corporate tax refunds
ExplanationReturn of taxes to businesses.
#10
What is the term for a tax levied on the transfer of property after the owner's death?
Estate tax
ExplanationTax on inheritance.
#11
What is the purpose of a government budget deficit?
To stimulate economic growth
ExplanationIntended to boost economic activity.
#12
What is the primary purpose of a sovereign wealth fund?
To manage and invest government savings
ExplanationInvestment vehicle for government reserves.
#13
What is the term used to describe a tax system where the tax rate decreases as the taxable amount increases?
Regressive tax
ExplanationTax rate reduces with income.
#14
What is the primary objective of a contractionary fiscal policy?
To decrease aggregate demand
ExplanationReduce overall spending.
#15
Which of the following is an example of a regressive expenditure?
Sales tax
ExplanationHigher burden on lower-income individuals.