placeholder image to represent content

Unit 6 Monetary & Fiscal Policy Test Review

Quiz by Derrick Allen

Our brand new solo games combine with your quiz, on the same screen

Correct quiz answers unlock more play!

New Quizalize solo game modes
23 questions
Show answers
  • Q1
    Federal Reserve Tools: Discount Rate, Reserve Requirement, ________ Fiscal Policy Tools: taxing, spending, borrowing What tool is missing from the Federal Reserve's list of tools?
    Monetary Policy
    district banks
    Board of Governors
    buy/sell securities
    60s
  • Q2
    If the economy is in an inflationary period, what action would Fiscal Policy most likely take?
    increase spending
    decrease taxes
    Increase taxes
    decrease the discount rate
    60s
  • Q3
    If Fiscal Policy is trying to promote stability and economic growth through tax cuts, what type of policy is Fiscal Policy using?
    Tight Money Policy
    Restrictive Policy
    Easy Money Policy
    Expansionary Policy
    60s
  • Q4
    If a nation currently has a budget deficit, their income is not covering the cost of running their country. If this budget is not revised, what could be a possible result of this situation?
    A balanced budget
    a budget surplus
    A mounting debt
    Discretionary fiscal policy
    60s
  • Q5
    Which of the following best describes the goal of Monetary Policy?
    controlling the money supply
    controlling the national debt
    controlling taxes
    stopping inflation
    60s
  • Q6
    If the economy is in a recession, the FED could do all of the following EXCEPT
    lower taxes
    lower the discount rate
    buy securities
    lower the Federal Funds rate
    60s
  • Q7
    How are Fiscal Policy and the Federal Reserve similar?
    They both have a Board of Governors
    They both try to promote economic stability
    They both use the same tools to fix economic problems
    They always must have Congressional approval before passing
    60s
  • Q8
    Which of the following would be classified as fiscal policy?
    The federal government passes tax cuts to encourage firms to reduce air pollution
    A state government cuts taxes to help the economy of the state
    The Federal Reserve cuts interest rates to stimulate the economy
    The federal government cuts taxes to stimulate the economy
    60s
  • Q9
    If policymakers are concerned that the economy is in danger of rising inflation because aggregate demand is increasing faster than aggregate supply, the appropriate fiscal policy response is to
    increase interest rates
    use expansionary fiscal policy
    decrease taxes
    decrease government spending
    60s
  • Q10
    To combat a recession with expansionary fiscal policy, Congress and the President should
    decrease government spending to balance the budget
    lower interest rates and increase investment by increasing the money supply
    decrease taxes to increase consumer disposable income
    raise taxes on interest and dividends, but not on personal income
    60s
  • Q11
    Which is NOT a function of the Federal Reserve?
    loan money to individuals and small businesses
    clear checks
    regulate the money supply
    process checks for the federal government
    60s
  • Q12
    Who issues U.S. paper currency?
    the district Federal Reserve Banks
    the U.S. Mint
    the Treasury Department
    the U.S. bank examiners
    60s
  • Q13
    What is the policy used most by the FED to change the money supply?
    changes in the discount rate
    changes in the reserve requirements
    changes in the money creation policy
    open market operations
    60s
  • Q14
    In order to increase the money supply, the Federal Open Market Committee can
    lower the prime rate
    raise the prime rate
    purchase bonds
    sell bonds
    60s
  • Q15
    Which of the following activities creates money?
    depositing money into a checking account
    withdrawing money from a checking account
    saving money in a piggy bank at home
    printing new currency to replace worn-out money
    60s

Teachers give this quiz to your class