#1
Which branch of the U.S. government is responsible for creating fiscal policy?
Executive Branch
Legislative Branch
Judicial Branch
State Governments
#2
What is the purpose of the Congressional Budget Office (CBO) in the United States?
To enforce tax laws
To advise Congress on economic matters
To regulate financial markets
To administer social welfare programs
#3
What is the purpose of the Office of Management and Budget (OMB) in the United States government?
To manage national parks
To oversee the federal budget and regulatory processes
To enforce trade policies
To conduct diplomatic negotiations
#4
What is the name of the federal agency responsible for collecting taxes in the United States?
Internal Revenue Service (IRS)
Federal Reserve System (Fed)
Securities and Exchange Commission (SEC)
Department of the Treasury
#5
Which government agency is responsible for implementing fiscal policy in the United States?
Federal Reserve
Congress
Department of the Treasury
Office of Management and Budget
#6
What is the primary goal of expansionary fiscal policy?
To reduce inflation
To increase government spending
To decrease aggregate demand
To decrease taxes
#7
Which of the following is an example of contractionary fiscal policy?
Increasing government spending during a recession
Decreasing taxes during an economic boom
Raising interest rates during inflation
Decreasing government spending during a recession
#8
Which of the following is a discretionary fiscal policy measure?
Unemployment benefits
Social Security payments
Infrastructure spending
Interest on the national debt
#9
During a recession, what would be the likely impact of an increase in government spending?
Decrease in aggregate demand
Increase in aggregate supply
Increase in inflation
Stimulation of economic activity
#10
Which of the following represents an example of an automatic stabilizer in fiscal policy?
Temporary tax cuts during a recession
Unemployment insurance benefits
Direct government investments in infrastructure
One-time stimulus payments to individuals
#11
What is the primary objective of a balanced budget amendment?
To ensure government spending never exceeds government revenue
To allow unlimited government borrowing
To eliminate all government debt
To increase government spending without limit
#12
What is the name of the theory that suggests that increases in government spending can stimulate economic growth?
Monetarism
Classical Economics
Supply-side Economics
Keynesian Economics
#13
Which of the following is NOT a tool of fiscal policy?
Government Spending
Taxation
Interest Rates
Transfer Payments
#14
Which of the following is an automatic stabilizer in fiscal policy?
Unemployment insurance
Corporate tax cuts
Infrastructure investment
Subsidies for renewable energy
#15
In the context of fiscal policy, what is 'crowding out'?
The phenomenon of private investment decreasing due to increased government borrowing
The process by which government spending crowds out consumer spending
The effect of inflation on interest rates
The reduction in government spending during a recession
#16
Which of the following is an example of an expansionary fiscal policy?
Decreasing government spending during a recession
Increasing taxes during an economic boom
Decreasing the money supply during inflation
Increasing government spending during a recession
#17
In the context of fiscal policy, what is the 'multiplier effect'?
The effect of government spending on aggregate demand and income, which is amplified through the economy
The tendency of government debt to increase over time
The process by which inflation erodes the value of money
The impact of trade deficits on a nation's currency value