SOLVED

1) Fiscal policy is the responsibility of ________. A) the Federal Reserve System. B) the Comptroller of the Currency. C) the President and U.S. Congress. D) High Commissioner for Refugees. 2) Fiscal policy involves manipulating ________. A) the supply of money. B) consumption spending. C) federal subsidies and minimum wage values. D) government spending and taxes. 3) A(n) ________ in aggregate demand will result from a decrease in ________. A) decrease; inflation B) increase; taxes C) decrease; the budget deficit D) increase; government purchases 4) According to the IS curve, the tax multiplier is always ________. A) larger in absolute value than the expenditure multiplier B) equal to the expenditure multiplier C) smaller in absolute value than the expenditure multiplier D) equal to one 5) The impact of a change in taxes on income is likely to be less than the effect resulting from a change in government spending since ________. A) the federal government typically operates in a deficit situation. B) exports and imports can only assume positive values, but net exports can be positive or negative. C) changes in the supply of money will be necessary if government spending is increased. D) changes in taxes exert an indirect impact on total spending through changes in consumption. 6) The American Recovery and Reinvestment Act of 2009 ________. A) offered a mix of tax cuts and spending increases. B) relied primarily on monetary expansion to achieve its ends. C) was consistently opposed by the Obama Administration. D) provided direct subsidy support to troubled financial institutions such as hedge funds. 7) The American Recovery and Reinvestment Act of 2009 provided ________. A) tax cuts of $288 million and a government spending increase of $499 million. B) tax cuts of $288 million and a government spending increase of $499 billion. C) tax cuts of $288 billion and a government spending increase of $499 billion. D) tax cuts of $288 trillion and a government spending increase of $499 trillion. 8) Taxes on wages, such as Social Security taxes, are known as ________. A) payroll taxes. B) lump sum taxes. C) capitol hill gains. D) cost of living adjustments. (COLAs). 9) Payroll taxes levy taxes on ________. A) consumption. B) imports. C) wages. D) exports. 10) A cut in the payroll tax will tend to cause, other things the same, ________. A) a change in aggregate demand, with no effect on supply B) a change in both aggregate demand and supply C) a change in aggregate supply, with no effect on demand D) no change in either aggregate demand or supply