Ch 15 – Flashcard Answers

question
In The Wealth of Nations (1776), Adam Smith made all of the following arguments for laissez-faire capitalism, EXCEPT which of the following?
answer
The government should not be allowed any role whatsoever in the economy.
question
Which of the following statements best describes the relationship today between government and the economy in the United States?
answer
The government has an important role in regulating and maintaining the U.S. economy
question
Economic efficiency requires
answer
that the output of goods and services is the highest possible given the amount of input used to produce them.
question
The term externalities refers to
answer
unpaid costs of production that are incurred by society.
question
When the Fed was created in 1913,
answer
it had no role in the management of the nation's economy.
question
A ruling by the Food and Drug Administration that a drug is dangerous to use and therefore cannot be marketed is an example of regulation for the purpose of
answer
equity.
question
The era of "new social regulation", which addressed issues such as the environment and worker safety, differed from the previous two eras of regulatory reform in that
answer
the aim was to regulate activities of firms of many types, not just those in a particular industry.
question
Government benefits for business include all of the following EXCEPT
answer
minimum-wage laws.
question
Judged in the context of the full range of public policies, the government in the United States has been
answer
substantially more supportive of business than labor.
question
Government support for agriculture in the form of price supports and income subsidies is designed primarily to
answer
stabilize farm income, which would otherwise fluctuate greatly due to market and weather conditions.
question
Fiscal policy is a mechanism the government employs to influence the economy. Fiscal policy is based on
answer
the government's taxing and spending decisions.
question
In John Maynard Keynes's demand-side economic theory, an economic recession can be shortened through
answer
government spending programs.
question
Supply-side economics, as implemented by President George W. Bush's administration, involved
answer
All these answers are correct
question
A fiscal policy solution to inflation would be to
answer
increase the tax rate.
question
Members of the Federal Reserve Board
answer
are appointed by the president and are not subject to removal.
question
What did Congress do in 1995 to reduce overregulation?
answer
It enacted legislation that prohibits administrators in some instances from issuing a regulation unless they can show that its benefits outweigh its costs.
question
The Progressive Era of government regulation focused on
answer
stopping the unfair business practices of the new monopolies, such as the railroads.
question
Monetary policy includes all the following assumptions EXCEPT that
answer
too little money in circulation contributes to inflation.
question
The Federal Reserve controls the money supply through all of the following actions EXCEPT
answer
lowering the tax rate on individuals.
question
Monetary policy differs from fiscal policy in that
answer
it can be implemented more quickly than fiscal policy.
question
________ wrote The Silent Spring in 1962.
answer
Rachel Carson
question
A major point of debate surrounding the Federal Reserve's role in economic policy is
answer
the Fed's political accountability.
question
Advocates of deregulation are primarily concerned with
answer
efficiency.
question
Regarding the Kyoto agreement and greenhouse gas emissions, which of the following is true?
answer
All these answers are correct.
question
Which president's use of government policy as economic stimulus ushered in the modern era of U.S. government fiscal policy
answer
Franklin Roosevelt1
question
The Superfund program is designed to
answer
provide funds for cleaning up badly contaminated and polluted sites.
question
If the economic problem is low productivity and high unemployment, the fiscal policy action on the demand side would be to
answer
increase spending
question
Which of the following statements is true?
answer
Keynes advocated government spending to counteract an economic downturn.
question
Over the past forty years, the burden of federal taxation has
answer
shifted from corporations to individuals.
question
What has been the preferred strategy of U.S. lawmakers for combating the problem of global warming?
answer
. alternative energy sources and energy conservation
question
Democrats in Washington have usually responded to high levels of unemployment with
answer
increased government spending
question
Which is true regarding the nation's environmental policy?
answer
A majority of the public is sympathetic to environmentalism.
question
Which of the following is correct about environmental policy?
answer
The national parks are subject to a dual use policy of preservation, recreation, and exploitation of the rich natural resources.
question
The ________ established minimum wages and constraints on the use of child labor.
answer
Fair Labor Standards Act of 1938
question
The highest rate of inflation (13 percent) since World War II occurred in ________.
answer
1979
question
he Federal Reserve System
answer
None of these answers is correct.
question
Earth Day was the brainchild of Senator
answer
Gaylord Nelson
question
Keynesian economics emphasizes ________ as a means of curtailing economic downturns.
answer
increased government spending
question
Supply-side economics is based primarily on
answer
stimulation of the business (supply) component.
question
The Federal Reserve plays a large part in establishing ________ policy.
answer
monetary
question
What was a major change brought about by the National Labor Relations Act of 1935?
answer
Workers were given the right to bargain collectively.
question
The first national park was created at ________ in 1872.
answer
Yellowstone
question
Which of the following government agencies regulates business competition?
answer
all of these: the Federal Trade Commission; the Interstate Commerce Commission; and the Antitrust Division of the Justice Department
question
Regulatory activity relating to the environment has actually meant that the environment today is
answer
vastly more clean than it was during the 1960s
question
The creation of the Food and Drug Administration and the passage of the Securities and Exchange Act were intended to
answer
promote equity in the economy.
question
The tax cuts pushed by President George W. Bush while in office were premised largely on
answer
supply-side economics.
question
The Tennessee Valley Authority is
answer
an electricity industry owned by the United States.
question
Farm subsidies have traditionally had strong support in Congress, particularly from
answer
rural-state senators and representatives.
question
About what percentage of the annual federal budget is accounted for by the interest paid on the national debt?
answer
15%
question
The federal government has assumed a permanent, strong role in the economy, contributing to its stability and efficiency, since
answer
the 1930s.
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question
In The Wealth of Nations (1776), Adam Smith made all of the following arguments for laissez-faire capitalism, EXCEPT which of the following?
answer
The government should not be allowed any role whatsoever in the economy.
question
Which of the following statements best describes the relationship today between government and the economy in the United States?
answer
The government has an important role in regulating and maintaining the U.S. economy
question
Economic efficiency requires
answer
that the output of goods and services is the highest possible given the amount of input used to produce them.
question
The term externalities refers to
answer
unpaid costs of production that are incurred by society.
question
When the Fed was created in 1913,
answer
it had no role in the management of the nation's economy.
question
A ruling by the Food and Drug Administration that a drug is dangerous to use and therefore cannot be marketed is an example of regulation for the purpose of
answer
equity.
question
The era of "new social regulation", which addressed issues such as the environment and worker safety, differed from the previous two eras of regulatory reform in that
answer
the aim was to regulate activities of firms of many types, not just those in a particular industry.
question
Government benefits for business include all of the following EXCEPT
answer
minimum-wage laws.
question
Judged in the context of the full range of public policies, the government in the United States has been
answer
substantially more supportive of business than labor.
question
Government support for agriculture in the form of price supports and income subsidies is designed primarily to
answer
stabilize farm income, which would otherwise fluctuate greatly due to market and weather conditions.
question
Fiscal policy is a mechanism the government employs to influence the economy. Fiscal policy is based on
answer
the government's taxing and spending decisions.
question
In John Maynard Keynes's demand-side economic theory, an economic recession can be shortened through
answer
government spending programs.
question
Supply-side economics, as implemented by President George W. Bush's administration, involved
answer
All these answers are correct
question
A fiscal policy solution to inflation would be to
answer
increase the tax rate.
question
Members of the Federal Reserve Board
answer
are appointed by the president and are not subject to removal.
question
What did Congress do in 1995 to reduce overregulation?
answer
It enacted legislation that prohibits administrators in some instances from issuing a regulation unless they can show that its benefits outweigh its costs.
question
The Progressive Era of government regulation focused on
answer
stopping the unfair business practices of the new monopolies, such as the railroads.
question
Monetary policy includes all the following assumptions EXCEPT that
answer
too little money in circulation contributes to inflation.
question
The Federal Reserve controls the money supply through all of the following actions EXCEPT
answer
lowering the tax rate on individuals.
question
Monetary policy differs from fiscal policy in that
answer
it can be implemented more quickly than fiscal policy.
question
________ wrote The Silent Spring in 1962.
answer
Rachel Carson
question
A major point of debate surrounding the Federal Reserve's role in economic policy is
answer
the Fed's political accountability.
question
Advocates of deregulation are primarily concerned with
answer
efficiency.
question
Regarding the Kyoto agreement and greenhouse gas emissions, which of the following is true?
answer
All these answers are correct.
question
Which president's use of government policy as economic stimulus ushered in the modern era of U.S. government fiscal policy
answer
Franklin Roosevelt1
question
The Superfund program is designed to
answer
provide funds for cleaning up badly contaminated and polluted sites.
question
If the economic problem is low productivity and high unemployment, the fiscal policy action on the demand side would be to
answer
increase spending
question
Which of the following statements is true?
answer
Keynes advocated government spending to counteract an economic downturn.
question
Over the past forty years, the burden of federal taxation has
answer
shifted from corporations to individuals.
question
What has been the preferred strategy of U.S. lawmakers for combating the problem of global warming?
answer
. alternative energy sources and energy conservation
question
Democrats in Washington have usually responded to high levels of unemployment with
answer
increased government spending
question
Which is true regarding the nation's environmental policy?
answer
A majority of the public is sympathetic to environmentalism.
question
Which of the following is correct about environmental policy?
answer
The national parks are subject to a dual use policy of preservation, recreation, and exploitation of the rich natural resources.
question
The ________ established minimum wages and constraints on the use of child labor.
answer
Fair Labor Standards Act of 1938
question
The highest rate of inflation (13 percent) since World War II occurred in ________.
answer
1979
question
he Federal Reserve System
answer
None of these answers is correct.
question
Earth Day was the brainchild of Senator
answer
Gaylord Nelson
question
Keynesian economics emphasizes ________ as a means of curtailing economic downturns.
answer
increased government spending
question
Supply-side economics is based primarily on
answer
stimulation of the business (supply) component.
question
The Federal Reserve plays a large part in establishing ________ policy.
answer
monetary
question
What was a major change brought about by the National Labor Relations Act of 1935?
answer
Workers were given the right to bargain collectively.
question
The first national park was created at ________ in 1872.
answer
Yellowstone
question
Which of the following government agencies regulates business competition?
answer
all of these: the Federal Trade Commission; the Interstate Commerce Commission; and the Antitrust Division of the Justice Department
question
Regulatory activity relating to the environment has actually meant that the environment today is
answer
vastly more clean than it was during the 1960s
question
The creation of the Food and Drug Administration and the passage of the Securities and Exchange Act were intended to
answer
promote equity in the economy.
question
The tax cuts pushed by President George W. Bush while in office were premised largely on
answer
supply-side economics.
question
The Tennessee Valley Authority is
answer
an electricity industry owned by the United States.
question
Farm subsidies have traditionally had strong support in Congress, particularly from
answer
rural-state senators and representatives.
question
About what percentage of the annual federal budget is accounted for by the interest paid on the national debt?
answer
15%
question
The federal government has assumed a permanent, strong role in the economy, contributing to its stability and efficiency, since
answer
the 1930s.