Question 1

Researchers believe that the economy grows at least one percentage point less annually when:

Accepted Answer

A) the ratio of public debt to GDP exceeds 90 percent for at least five years in a row. 
B) the ratio of public debt to GDP exceeds 50 percent for at least two years in a row. 
C) the growth rate of population falls for at least five years in a row. 
D) the rate of inflation is below 4 percent for at least two years in a row. 
E) the growth rate of real interest rates falls for at least five years in a row. 
A) the ratio of public debt to GDP exceeds 90 percent for at least five years in a row. 
B) the ratio of public debt to GDP exceeds 50 percent for at least two years in a row. 
C) the growth rate of population falls for at least five years in a row. 
D) the rate of inflation is below 4 percent for at least two years in a row. 
E) the growth rate of real interest rates falls for at least five years in a row.

Question 2

Crowding out occurs because lower interest rates discourage saving and make it harder to borrow.

Accepted Answer

A) True 
 B)False

Question 3

Problems with the federal government budget process include:

Accepted Answer

A) tough choices to be made by Congress each year on which entitlement programs will receive full support. 
B) the constitutional requirement of Congress to balance the budget on an annual basis. 
C) an overly detailed budget that allows Congress to reward friends,thereby discouraging restraint on spending. 
D) a short review period for Congress that results in poor choices in funding programs. 
E) Congress having too much control over the budgetary process. 
A) tough choices to be made by Congress each year on which entitlement programs will receive full support. 
B) the constitutional requirement of Congress to balance the budget on an annual basis. 
C) an overly detailed budget that allows Congress to reward friends,thereby discouraging restraint on spending. 
D) a short review period for Congress that results in poor choices in funding programs. 
E) Congress having too much control over the budgetary process.

Question 4

A continuing resolution is:

Accepted Answer

A) an agreement that requires Congress to balance the budget on an annual basis. 
B) an agreement that allows Congress to have too much control over the budgetary process. 
C) an agreement that allows agencies to spend at the rate of the previous year's budget. 
D) a decision made by congressional committee about the federal spending and revenue levels for five years. 
E) a guaranteed benefit for those who qualify for government transfer programs. 
A) an agreement that requires Congress to balance the budget on an annual basis. 
B) an agreement that allows Congress to have too much control over the budgetary process. 
C) an agreement that allows agencies to spend at the rate of the previous year's budget. 
D) a decision made by congressional committee about the federal spending and revenue levels for five years. 
E) a guaranteed benefit for those who qualify for government transfer programs.

Question 5

The U.S.government's fiscal year extends from:

Accepted Answer

A) January to December. 
B) April of one year to March of the next year. 
C) June of one year to May of the next year. 
D) September of one year to August of the next year. 
E) October of one year to September of the next year. 
A) January to December. 
B) April of one year to March of the next year. 
C) June of one year to May of the next year. 
D) September of one year to August of the next year. 
E) October of one year to September of the next year.

Question 6

Problems with the federal government budget process include:

Accepted Answer

A) budgeting that allows the President too much discretion in spending decisions. 
B) budgeting that increases the flexibility of discretionary fiscal policy. 
C) a budget outline that needs to be approved with at least a two-thirds majority vote. 
D) most of the expenditures being for entitlement programs. 
E) a brief budgeting that does not allow Congress to study whether the budget is an appropriate tool for fiscal policy. 
A) budgeting that allows the President too much discretion in spending decisions. 
B) budgeting that increases the flexibility of discretionary fiscal policy. 
C) a budget outline that needs to be approved with at least a two-thirds majority vote. 
D) most of the expenditures being for entitlement programs. 
E) a brief budgeting that does not allow Congress to study whether the budget is an appropriate tool for fiscal policy.

Question 7

Crowding in occurs when government spending improves business expectations about the future and leads to higher business investment spending.

Accepted Answer

A) True 
 B)False

Question 8

The federal budget surplus recorded in 1998 resulted from a(n):

Accepted Answer

A) decrease in taxes and rapid growth in federal outlays. 
B) increase in taxes and sluggish growth in federal outlays. 
C) decrease in taxes and a decrease in federal outlays. 
D) increase in federal outlays and taxes. 
E) increase in export earnings and decrease in import bills. 
A) decrease in taxes and rapid growth in federal outlays. 
B) increase in taxes and sluggish growth in federal outlays. 
C) decrease in taxes and a decrease in federal outlays. 
D) increase in federal outlays and taxes. 
E) increase in export earnings and decrease in import bills.

Question 9

A major problem with the implementation of an annually balanced budget is that it:

Accepted Answer

A) allows the national debt to burgeon with chronic deficits. 
B) relies upon government officials to budget for surpluses during economic booms in order to cover deficits during recessions. 
C) requires annual revenues to match with outlays even during times of war,when there is a sudden increase in military expenditures. 
D) magnifies the fluctuations in the business cycle. 
E) dampens swings in the business cycle. 
A) allows the national debt to burgeon with chronic deficits. 
B) relies upon government officials to budget for surpluses during economic booms in order to cover deficits during recessions. 
C) requires annual revenues to match with outlays even during times of war,when there is a sudden increase in military expenditures. 
D) magnifies the fluctuations in the business cycle. 
E) dampens swings in the business cycle.

Question 10

Crowding out occurs by:

Accepted Answer

A) causing reduced government purchases of goods and services. 
B) reducing the value of the multiplier used for government purchases of goods and services by increasing the interest rate. 
C) reducing the value of the multiplier used for government purchases of goods and services by increasing the marginal propensity to consume. 
D) reducing the value of the multiplier used for government purchases of goods and services by decreasing the marginal propensity to consume. 
E) causing reduced imports of goods and services. 
A) causing reduced government purchases of goods and services. 
B) reducing the value of the multiplier used for government purchases of goods and services by increasing the interest rate. 
C) reducing the value of the multiplier used for government purchases of goods and services by increasing the marginal propensity to consume. 
D) reducing the value of the multiplier used for government purchases of goods and services by decreasing the marginal propensity to consume. 
E) causing reduced imports of goods and services.

Question 11

One way of improving the federal government budget process is to:

Accepted Answer

A) switch to a two-year or biennial budget. 
B) remove the Council of Economic Advisers from the process. 
C) detail budgeting by focusing on all groupings and line items. 
D) provide for automatic annual increases in all budget categories. 
E) eliminate the role of Congressional committees in the process. 
A) switch to a two-year or biennial budget. 
B) remove the Council of Economic Advisers from the process. 
C) detail budgeting by focusing on all groupings and line items. 
D) provide for automatic annual increases in all budget categories. 
E) eliminate the role of Congressional committees in the process.

Question 12

A possible budget reform involves:

Accepted Answer

A) a quadrennial budget. 
B) breaking down the budget into increasingly small budget lines. 
C) appointing agency heads with different priorities than those of elected representatives. 
D) to simplify the budget document by concentrating only on major groupings and eliminating line items. 
E) to eliminate the operating budget. 
A) a quadrennial budget. 
B) breaking down the budget into increasingly small budget lines. 
C) appointing agency heads with different priorities than those of elected representatives. 
D) to simplify the budget document by concentrating only on major groupings and eliminating line items. 
E) to eliminate the operating budget.

Question 13

Which of the following countries hold the most U.S.Treasury securities?

Accepted Answer

A) Japan and China 
B) Taiwan and Brazil 
C) United Kingdom 
D) Belgium 
E) Switzerland 
A) Japan and China 
B) Taiwan and Brazil 
C) United Kingdom 
D) Belgium 
E) Switzerland

Researchers believe that the economy grows at least one percentage point less annually when:

Crowding out occurs because lower interest rates discourage saving and make it harder to borrow.

Problems with the federal government budget process include:

A continuing resolution is:

The U.S.government's fiscal year extends from:

Problems with the federal government budget process include:

Crowding in occurs when government spending improves business expectations about the future and leads to higher business investment spending.

The federal budget surplus recorded in 1998 resulted from a(n):

A major problem with the implementation of an annually balanced budget is that it:

Crowding out occurs by:

One way of improving the federal government budget process is to:

A possible budget reform involves:

Which of the following countries hold the most U.S.Treasury securities?

The Art and Science of Economic Analysis

Some Tools of Economic Analysis

Economic Decision Makers

Demand, Supply, and Markets

Introduction to Macroeconomics

Tracking the U S Economy

Unemployment and Inflation

Us Productivity and Growth

Aggregate Demand

Aggregate Supply

Fiscal Policy

Money and the Financial System

Banking and the Money Supply

Monetary Theory and Policy

The Policy Debate: Active or Passive

International Trade

International Finance

Economic Development

Filters

Exam 12: Federal Budgets and Public Policy

Researchers believe that the economy grows at least one percentage point less annually when:

Crowding out occurs because lower interest rates discourage saving and make it harder to borrow.

Problems with the federal government budget process include:

A continuing resolution is:

The U.S.government's fiscal year extends from:

Problems with the federal government budget process include:

Crowding in occurs when government spending improves business expectations about the future and leads to higher business investment spending.

The federal budget surplus recorded in 1998 resulted from a(n):

A major problem with the implementation of an annually balanced budget is that it:

Crowding out occurs by:

One way of improving the federal government budget process is to:

A possible budget reform involves:

Which of the following countries hold the most U.S.Treasury securities?

The Art and Science of Economic Analysis

Some Tools of Economic Analysis

Economic Decision Makers

Demand, Supply, and Markets

Introduction to Macroeconomics

Tracking the U S Economy

Unemployment and Inflation

Us Productivity and Growth

Aggregate Demand

Aggregate Supply

Fiscal Policy

Money and the Financial System

Banking and the Money Supply

Monetary Theory and Policy

The Policy Debate: Active or Passive

International Trade

International Finance

Economic Development

Filters