Macroeconomics Module 11 Review

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ECON-2410 Review

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Naomi Pham

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Macroeconomics Module 11 ReviewOnline version ECON-2410 Review by Naomi Pham 1 Economists use the term fiscal policy to refer to changes in taxing and spending policies a only by the federal government b only by state and local governments c by all levels of government, federal, state, and local d by none of the above 2 Changes in taxes and spending that happen without actions by the government are called a automatic stabilizers b discretionary fiscal policy changes c autonomous fiscal expenditures d transfer payments 3 If the government cuts taxes in order to increase aggregate demand, the action is called a a discretionary fiscal policy b a procyclical policy c an automatic stabilizer d a discretionary monetary policy 4 Which of the following are categories of federal government expenditures? a transfer payments b interest on the national debt c grants to state and local governments d all of the above 5 The goal of expansionary fiscal policy is a to increase aggregate demand b to decrease short-run aggregate supply c to decrease long-run aggregate supply d all of the above 6 Consider the figures below. Determine which combination of fiscal policies shifted AD1 to AD2 in each figure and returned the economy to long-run macroeconomic equilibrium. a example A: expansionary fiscal policy; example B: contractionary fiscal policy b example A: contractionary fiscal policy; example B: contractionary fiscal policy c example A: expansionary fiscal policy; example B: expansionary fiscal policy d example A: contractionary fiscal policy; example B: expansionary fiscal policy 7 An attempt to reduce inflation requires ____ fiscal policy, which causes real GDP to ____ and the price level to ____. a contractionary; fall; fall b expansionary; rise; rise c contractionary; rise; fall d expansionary; rise; fall

Macroeconomics Module 11 ReviewOnline version

ECON-2410 Review

by Naomi Pham

Economists use the term fiscal policy to refer to changes in taxing and spending policies

only by the federal government

only by state and local governments

by all levels of government, federal, state, and local

by none of the above

Changes in taxes and spending that happen without actions by the government are called

automatic stabilizers

discretionary fiscal policy changes

autonomous fiscal expenditures

transfer payments

If the government cuts taxes in order to increase aggregate demand, the action is called

a discretionary fiscal policy

a procyclical policy

an automatic stabilizer

a discretionary monetary policy

Which of the following are categories of federal government expenditures?

transfer payments

interest on the national debt

grants to state and local governments

all of the above

The goal of expansionary fiscal policy is

to increase aggregate demand

to decrease short-run aggregate supply

to decrease long-run aggregate supply

all of the above

Consider the figures below. Determine which combination of fiscal policies shifted AD1 to AD2 in each figure and returned the economy to long-run macroeconomic equilibrium.

example A: expansionary fiscal policy; example B: contractionary fiscal policy

example A: contractionary fiscal policy; example B: contractionary fiscal policy

example A: expansionary fiscal policy; example B: expansionary fiscal policy

example A: contractionary fiscal policy; example B: expansionary fiscal policy

An attempt to reduce inflation requires fiscal policy, which causes real GDP to and the price level to .

contractionary; fall; fall

expansionary; rise; rise

contractionary; rise; fall

expansionary; rise; fall

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Macroeconomics Module 11 Review

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Macroeconomics Module 11 ReviewOnline version

by Naomi Pham

Economists use the term fiscal policy to refer to changes in taxing and spending policies

Changes in taxes and spending that happen without actions by the government are called

If the government cuts taxes in order to increase aggregate demand, the action is called

Which of the following are categories of federal government expenditures?

The goal of expansionary fiscal policy is

Consider the figures below. Determine which combination of fiscal policies shifted AD1 to AD2 in each figure and returned the economy to long-run macroeconomic equilibrium.

An attempt to reduce inflation requires fiscal policy, which causes real GDP to and the price level to .

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Macroeconomics Module 11 Review

Quiz

About this activity

Created by

Download the paper version to play

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Macroeconomics Module 11 ReviewOnline version

by Naomi Pham

Economists use the term fiscal policy to refer to changes in taxing and spending policies

Changes in taxes and spending that happen without actions by the government are called

If the government cuts taxes in order to increase aggregate demand, the action is called

Which of the following are categories of federal government expenditures?

The goal of expansionary fiscal policy is

Consider the figures below. Determine which combination of fiscal policies shifted AD1 to AD2 in each figure and returned the economy to long-run macroeconomic equilibrium.

An attempt to reduce inflation requires ____ fiscal policy, which causes real GDP to ____ and the price level to ____.

An attempt to reduce inflation requires fiscal policy, which causes real GDP to and the price level to .