Shiddent: 1. When the Federal government uses taxation and spending actions to s

Question

Shiddent: 1. When the Federal government uses taxation and spending actions to stimulate the economy it is conducting: A. Fiscal policy B. Incomes policy C. Monetary policy D. Employment policy When the Federal government takes budgetary action to stimulate the economy or rein in inflation, such policy is:a 2. A. Active Monetary Policy B. Automatic Fiscal Policy C. Discretionary Fiscal Policy D. Active Federal Policy 3. When changes in taxes and govenment spending occur in the economy without explicit action by Congress, such policy is: A. Cyclical B. Implicit C. Discretionary 4. When the Federal government cut taves and increases spending to stimulate the economy during a period of recession, such actions are designed to be: A. Passive B. Automatic C. Countercyclical D. Nondiscretionary 45. Fiscal policy is enacted through changes in: A. Interest rates and the price leve B. The supply of money and foreign exchange C. Unemployment and inflation D. Taxation and government spending 6. The group that often initiates changes in fiscal policy is the: A. Congressional Budget Office B. Council of Economic Advisors C. Joint Economic Committee D. Federal Reserve Board 7. If Congress passes legislation to increase govenment spending to counter the effects of a recession,then this would be an example of a(n): A. Supply-side fiscal policy B. Expansionary fiscal policy C. Contractionary fiscal policy D. Nondiscretionary fiscal policy

Explanation / Answer

Answer : 1) When the Federal government uses taxation and spending actions to stimulate the economy it is conducting : (A) Fiscal policy.

2) When Federal government takes budgetary action to stimulate the economy or rein in inflation, such policy is : (C) Discretionary Fiscal Policy.

3) When changes in taxes and government spending occur in the economy without explicit action by Congress, such policy is : (D) Nondiscretionary.

4) When the Federal government cut taxes and increases spending to stimulate the economy during a period of recession, such actions are designed to be : (C) Countercyclical.

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