Taxes and fiscal policy MCQs

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  • 1/10 Questions

    A Budget deficit occurs when?

    • The government spends less money than it brings in for a fiscal year
    • When government is not able to raise money
    • The government spends more money than it brings in for a fiscal year
    • None of the above
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About This Quiz

Fiscal policy is the policy influencing government expenditure and revenue. Taxes form a major part of it. Play this informative MCQ based quiz and see how well you know the concepts. The quiz will certainly help you in acing your economics exams. The quiz contains questions that are wide-ranging and conceptually based. The quiz is aimed at enhancing your understanding of the topic. Once you take this quiz, you will be able to tackle all questions related to this topic in any exam. All the best!

Taxes And Fiscal Policy MCQs - Quiz

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  • 2. 

    Which of the following factors is principally in charge of managing the money supply?

    • The United States Treasury

    • The Federal Deposit Insurance Corporation

    • The Federal Reserve System

    • The Comptroller of the Currency

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  • 3. 

    The alteration of the money supply's size to affect the price and accessibility of credit is

    • Contractionary policy

    • Fiscal policy

    • Monetary Policy

    • Expansionary policy

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  • 4. 

    Fiscal stimulus, stimulus cheques, decreased reserve requirements, lower interest rates, and reduced taxes are examples of?

    • Expansionary Policy

    • Fiscal policy

    • Contractionary policy

    • Monetary policy

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  • 5. 

    What impact does the Federal Reserve's purchase of government bonds and securities on the country's aggregate demand and money supply?

    • Money supply increases; aggregate demand decreases

    • Money supply increases; aggregate demand increases

    • Money supply decreases; aggregate demand increases

    • Money supply decreases; aggregate demand decreases

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  • 6. 

    The Federal Reserve may implement any of the following monetary policies, with the exception of?

    • Raising the discount rate.

    • Buying government bonds.

    • Lowering the reserve requirement.

    • Raising personal income tax rates.

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  • 7. 

    When does the money loses its value?

    • Durable

    • Becomes too portabale

    • It becomes too plentiful

    • Is divisible

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  • 8. 

    What are the four major types of economic systems?

    • Microeconomics, Macroeconomics, Individual, and Traditional.

    • Traditional, Command, Combined, & Market

    • Communism, Capitalism, Free Market, and Macroeconomics

    • Traditional, Command, Mixed, & Market

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  • 9. 

    The Federal Reserve would do which of the following in order to expand the economy?

    • Raise the discount rate

    • Buy bonds

    • Sell bonds

    • Raise the reserve requirement

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  • 10. 

    The interest rate that the Fed charges banks for loans?

    • Federal fund rate

    • Discount rate

    • Reserve ratio

    • Prime rate

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Quiz Review Timeline (Updated): Nov 16, 2023 +

Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.

  • Current Version
  • Nov 16, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Nov 11, 2022
    Quiz Created by
    Amit Mangal
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