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Econ Final Exam T/F questions 1-39 and test questions
Terms in this set (57)
The Social Security System serves as a _______ for the economy.
An example of a fiscal stimulus is a ____ budget
The Federal Reserve generally will tighten the money supply during period of _____ and _____
recovery and prosperity
The Federal Reserve generally will loosen the money supply during periods of ________ and _______.
recession and depression
The main hardships of ________ are the redistribution of income caused by rising prices and the deterioration of past savings.
As incomes rise, the rising rate of personal and corporate savings can act as a deterrent to _______.
inflation [Automatic stabilizer]
According to the income-expenditure approach, inflation will occur at the full employment level if the effective demand exceeds ________.
___________ can occur when the total monetary demand for goods and services is in excess of the value of currently produced goods and services.
Inflation can be offset by _____ the demand for goods and services.
decreasing [Too much money chasing too few goods]
Inflation can be offset by _____ production.
In a ______ economy it is difficult to reduce government spending as a means of combating inflation.
A ________ budget is usually referred to as a "fiscal drag"
The burden of the national debt for individuals and business firms _____ be passed on to future generations.
Reducing the national debt is known as "_________ the debt"
The absolute size of the debt has been _______.
growing [both absolute and relative size growing]
An argument for maintaining the debt ceiling is that it makes the taxpayers more conscious of the _______ of government services.
The wider the __________ during a defense or war period the more conscious of the cost of government services.
The higher the economy's level of capacity utilization, the lower will be the rate of __________.
unemployment [one goes up, one goes down]
The progressive income tax serves as a(n) _________ for the U.S. economy.
Investment tax credits are a ______ policy device.
Changing the discount rate is a tool of _______ policy.
A major weakness of using __________ as an expansionary device involves the long period of time to plan and begin the project.
The expansionary effect on the economy that result from a government budget is known as a ________
__________ analysis provides the basis for demand-management policies designed to stimulate high levels of employment.
Wage and price controls were imposed on the U.S. economy to suppress _______ in 1971.
The Federal Reserve usually increases ________ rates during inflationary periods
interest [to ration loans]
The most effective way for the government to develop a surplus as a contractionary measure is to increase ______ and hold or decrease _______.
If the government develops a budget surplus as a means of combating inflation the surplus funds _________ to be spend as soon as possible.
do not need
The Philips curves shows a trade-off between ________ and _________.
unemployment and inflation
Credit restrictions that (increase/decrease) the size of down payments and (lengthen/shorten) loan maturities promote economic expansion.
Inflation and unemployment (can/can not) exist at the same time
Demand-pull inflation usually occurs in a _________ economy.
Deflation and disinflation (are/are not) synonymous terms.
Debtors tend to benefit more from ______ than creditors do.
inflation [opposite true for deflation]
A _______ budget will tend to have an expansionary effect on any economy that is not in a state of full employment
When the government borrows from the banks, "the debt is ________"
______ policies of taxing and spending are associated with Keynes.
Payment of the national debt in large portions over a short period of time would result in a redistribution of income that could have an _______ effect on the economy.
Borrowing (is/is not) the major source of all revenue for all branches of government.
(T/F) The bible contain no issues dealing with the production/accumulation of wealth
(T/F) The parable of talent shows rewards of responsibility
(T/F) Principles of supply and demand were created by man
(T/F) There are as many verses calling us to be successful as there are for being faithful
(T/F) The bible tells us that if we consume ourselves with collecting material on earth it will crowd out God in our heart.
(mult. choice) Government demand management policies include:
Both monetary and Fiscal
(mult. choice) Basic Difference between welfare and public works is that the latter:
adds to national stock of total output
(mult. choice) Forces within the economy that naturally tend to counteract recessions and inflations are called:
(mult. choice) When the budget is used as a tool for balancing economically of the business cycle then the balance should be : ?
during the business cycle
(mult. choice) Major device used today to distribute wealth
(mult. choice) Drop in rate of inflation is known as:
The federal government taxes individuals on _____ income.
net or adjusted gross.
Tax_____ is definitely illegal.
Taking advantage of a technicality in the law in order to save money is tantamount to tax _______.
Taxes constitute an important source of _______ for the federal government.
Property taxe rates are usually ______
Expenditures for________ comprise the largest share of state and local budgets.
Although governments have expanded their functions, they have done so at increasing _________.
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