Student name:__________
1) What is fiscal policy?
A) It is the government's approach to its own spending and taxation.
B) It is the use of interest rate policy by the central bank to stabilize an economy.
C) It is the total spending by all levels of government.
D) It is the central bank's approach to interest rate policy.
E) It is employed by governments only when the economy is experiencing a recessionary
gap.
2) All of the following, except one, are revenue categories in the federal government's
budget plan. Which is the exception?
A) Personal income taxes.
B) GST and excise taxes.
C) Corporate income taxes.
D) E.I. premiums.
E) Revenue from the sale of government bonds.
3) All of the following, except one, are outlays categories in the federal government's
budget plan. Which is the exception?
A) Transfers to persons.
B) International debt charges.
C) Public debt charges.
D) Spending grants to other levels of government.
E) Direct program spending.
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,4) What is net tax revenue in excess of government spending on goods and services called?
A) Gross tax revenue.
B) A budget deficit.
C) A budget surplus.
D) Transfer payments.
5) What is government spending on goods and services in excess of net tax revenue called?
A) Monetizing the debt.
B) A budget deficit.
C) A budget surplus.
D) Pro-cyclical fiscal policy.
6) What is a budget deficit?
A) It is government spending of all types in excess of net tax revenue.
B) It is government spending on goods and services in excess of net tax revenue.
C) It is government spending of all types plus net tax revenues.
D) It is the amount by which federal government spending of all types is below net tax
revenues.
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,7) What is a balanced budget?
A) It is the equality of tax revenues and government spending on goods and services.
B) It is the equality of net tax revenues and government spending on goods and services
C) It is the absence of government debt.
D) It is a budget where the government spends over many categories in a balanced
fashion.
8) Which of the following is a correct statement about the federal government's budget?
A) It has been in a deficit continuously since the 1960s.
B) It has been in a surplus continuously since the 1960s.
C) It has been in a deficit in the last few years.
D) It has been in a surplus in the last few years after decades of deficits.
9) What is the national debt?
A) The sum of the federal government's budget deficits less surpluses.
B) The total amount borrowed domestically by all levels of government.
C) The total amount borrowed domestically and internationally by all levels of
government.
D) The amount owed by the federal government to the World Bank.
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, 10) Suppose that the government's total tax receipts are $130, government spending on goods
and services is $100 and transfer payments are $40. What is the government's budget surplus or
deficit?
A) A surplus of $30.
B) A surplus of $10.
C) A deficit of $30.
D) A deficit of $10.
11) Suppose that the government's total tax receipts are $130, government spending on goods
and services is $100 and transfer payments are $40. What are net tax revenues?
A) -$10.
B) +$30.
C) +$70.
D) +$90.
12) What determines the state of the government's budget?
A) The level of its spending.
B) Its tax rates.
C) Its tax rates and the exchange rate.
D) Both the level of GDP in the economy as well as tax rates and its own spending.
E) Both the level of GDP in the economy as well as tax rates and the exchange rate.
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1) What is fiscal policy?
A) It is the government's approach to its own spending and taxation.
B) It is the use of interest rate policy by the central bank to stabilize an economy.
C) It is the total spending by all levels of government.
D) It is the central bank's approach to interest rate policy.
E) It is employed by governments only when the economy is experiencing a recessionary
gap.
2) All of the following, except one, are revenue categories in the federal government's
budget plan. Which is the exception?
A) Personal income taxes.
B) GST and excise taxes.
C) Corporate income taxes.
D) E.I. premiums.
E) Revenue from the sale of government bonds.
3) All of the following, except one, are outlays categories in the federal government's
budget plan. Which is the exception?
A) Transfers to persons.
B) International debt charges.
C) Public debt charges.
D) Spending grants to other levels of government.
E) Direct program spending.
Version 1 1
,4) What is net tax revenue in excess of government spending on goods and services called?
A) Gross tax revenue.
B) A budget deficit.
C) A budget surplus.
D) Transfer payments.
5) What is government spending on goods and services in excess of net tax revenue called?
A) Monetizing the debt.
B) A budget deficit.
C) A budget surplus.
D) Pro-cyclical fiscal policy.
6) What is a budget deficit?
A) It is government spending of all types in excess of net tax revenue.
B) It is government spending on goods and services in excess of net tax revenue.
C) It is government spending of all types plus net tax revenues.
D) It is the amount by which federal government spending of all types is below net tax
revenues.
Version 1 2
,7) What is a balanced budget?
A) It is the equality of tax revenues and government spending on goods and services.
B) It is the equality of net tax revenues and government spending on goods and services
C) It is the absence of government debt.
D) It is a budget where the government spends over many categories in a balanced
fashion.
8) Which of the following is a correct statement about the federal government's budget?
A) It has been in a deficit continuously since the 1960s.
B) It has been in a surplus continuously since the 1960s.
C) It has been in a deficit in the last few years.
D) It has been in a surplus in the last few years after decades of deficits.
9) What is the national debt?
A) The sum of the federal government's budget deficits less surpluses.
B) The total amount borrowed domestically by all levels of government.
C) The total amount borrowed domestically and internationally by all levels of
government.
D) The amount owed by the federal government to the World Bank.
Version 1 3
, 10) Suppose that the government's total tax receipts are $130, government spending on goods
and services is $100 and transfer payments are $40. What is the government's budget surplus or
deficit?
A) A surplus of $30.
B) A surplus of $10.
C) A deficit of $30.
D) A deficit of $10.
11) Suppose that the government's total tax receipts are $130, government spending on goods
and services is $100 and transfer payments are $40. What are net tax revenues?
A) -$10.
B) +$30.
C) +$70.
D) +$90.
12) What determines the state of the government's budget?
A) The level of its spending.
B) Its tax rates.
C) Its tax rates and the exchange rate.
D) Both the level of GDP in the economy as well as tax rates and its own spending.
E) Both the level of GDP in the economy as well as tax rates and the exchange rate.
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