Economics 15 part 2 – Flashcards
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All of the reasons why it is difficult to implement balanced fiscal policy EXCEP
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a significant role for government in running of the economy
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An example of an automatic stabilizer is
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taxes
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Supporters of supply-side economics believe that
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taxes have a strong negative influenc on economic output
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Supporters of supply-side economics believe that
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taxes have a strong negative influence on economic output
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An accurate statement about achieving a balanced budget would be that
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most states require a balanced budget for state spending
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The federal government's Fiscal Year 2007 begins on
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October 1, 2006
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Congress has passed several bills outlining the federal budget. What is the next step in the budget process?
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The president signs the budget intolaw or vetoes and sends it back to Congress
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What leads directly to the crowding- out- effect?
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a BIG federal budget DEFICIT
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Which of these statements is a fundamental part of Keynesian economics?
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The government can use deficit spending to increase agggregate demand and pull the economy out of recession
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What is one example of an automatic stabilizer?
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food stamps
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Which of these statements is a fundamental part of supply-side economics?
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The government SHOULD REDUCE TAXES TO PROMOTE ECONOMIC GROWTH BY INCREASING AGGREGATE SUPPLY
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The Laffer curve predicts the effects of changes in the tax rate on
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tax revenues
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Which of these is a contractionary fiscal policy?
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The President and Congress pass a new two-cent-per-gallon gasoline tax
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The President has veteod several appropriations bills. What is the next step in the budget process?
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Congress can vote to OVERRIDE THE VETOES OR PASS NEW APPROPIATIONS BILLS THAT THE PRESIDENT IS LIKELY TO SIGN
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what will DIRECTLY to a government "shut down?"
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THE PRESIDENT VETEOS CONGRESS'S APPROPIATIONS BILLS
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What makes increases goivernment spending an effective tool for increasing demand?
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the multiplier effect
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How did the Great Depression relate to the school of classical economics?
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the Great Depression appeared to disprove the classical theory that demand and supply could return to a HEALTHY EQUILIBRUIM through market forces alone
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Which statement describes the federal government's fiscal policies in the 1980s?
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Income tax rates were REDUCED, but spending INCREASED
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Which of these Presidents increased top marginal income tax rates during his term in office?
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Franklin D. Roosevelt
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Robin buys a newly-issues Treasury ond, Treasury note, and Treasury bill. Which will mature and be repaid by the government LAST?
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Treasury bond
