Fiscal Class Notes

Question 1

The two tools of what policy is the government spending and tax policy?

Answer 1

Fiscal policy

Question 2

What Administration came up with the leave the economy alone and it would correct itself policy?

Answer 2

Hoover Administration

Question 3

The government during fiscal policy increases spending and cuts taxes to solve what?

Answer 3

Unemployment

Question 4

During fiscal policy the government decreases government spending and increases income taxes to solve what?

Answer 4

Inflation

Question 5

Government spending is very ________ when solving unemployment.

Answer 5

Direct

Question 6

Realizing recessions or unemployment problem too late is considered what problem in fiscal policy?

Answer 6

Timing problem

Question 7

When all policy is carried out by politicians it’s creates what problem in fiscal policy?

Answer 7

Political problem

Question 8

The amount that would have been spent by the state and local is now spent by the government instead. This illustrates what problem in fiscal policy?

Answer 8

State and local problem

Question 9

During a recession we __________ money and during the recovery we pay off the ________.

Answer 9

Borrow

Debt

Question 10

Increase government spending and drop taxes to solve what?

Answer 10

Recessions

Question 11

Government spending increases what right away?

Answer 11

GDP

Question 12

Cutting taxes during expansionary fiscal policy does not guarantee that ___________ will increase because of consumer nervousness.

Answer 12

Consumption

Question 13

What is the largest government expenditure?

Answer 13

Defense spending

Question 14

The US currency is the ___________ currency in the world.

Answer 14

Strongest