Chapter 8 Fiscal Federalism

Chapter 8: Fiscal Federalism
1 What is the purpose of the federal government using money to influence states?

A) To promote economic growth in states

B) To encourage states to give up control over some of their powers

C) To fund state-specific projects

D) To create federal laws for state compliance
Answer: B

2 Which type of grant gives money for a broad purpose with few strings attached?

A) Categorical Grant

B) Block Grant

C) Formula Grant

D) Project Grant
Answer: B

3 Which of the following is an example of a block grant?

A) National Minimum Drinking Age Act (1984)

B) 1996 Clinton Welfare Reform Act

C) Medicaid

D) Temporary Assistance for Needy Families (TANF)
Answer: B

4 Which type of grant is more common than block grants and comes with restrictions?

A) Block Grant

B) Formula Grant

C) Categorical Grant

D) Project Grant
Answer: C

5 What is a characteristic of a categorical grant?

, A) Funds given with no restrictions

B) Specific purpose with restrictions

C) Competitive application process

D) Used for emergency purposes
Answer: B

6 Which of the following is an example of a categorical grant?

A) Temporary Assistance for Needy Families (TANF)

B) Medicaid

C) National Minimum Drinking Age Act (1984)

D) Head Start
Answer: C

7 What are the two types of categorical grants?

A) Block Grants and Project Grants

B) Formula Grants and Project Grants

C) Block Grants and Formula Grants

D) Formula Grants and Revenue Sharing
Answer: B

8 How is money distributed in a project grant?

A) Based on population

B) Through a competitive application process

C) Without competition, based on needs

D) Given to all states equally
Answer: B

9 How is money distributed in a formula grant?

A) Based on population, income, and other factors

B) Through competitive applications