CCP GOV CHAP 16 MULT CHOICE

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Inflation is best understood as the rate at which
a. gross domestic product expands
b. prices for goods and services decrease
c. prices for goods and services increase
d. the federal government increases taxes to raise revenue
e. the Federal Reserve Board expands the money supply
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Inflation is best understood as the rate at which
a. gross domestic product expands
b. prices for goods and services decrease
c. prices for goods and services increase
d. the federal government increases taxes to raise revenue
e. the Federal Reserve Board expands the money supply
c. prices for goods and services increase
What do economists use gross domestic product to measure? ON TEST
a. the rate of government spending in the economy
b. the rate of tariffs applied to goods imported into the United States
c. the total impact of import revenues on the domestic economy
d. the total value added by government expenditures in the economy
e. the total value of goods and services produced in the economy
e. the total value of goods and services produced in the economy
The Affordable Care Act, colloquially known as Obamacare, deals primarily with what policy area?
a. education
b. health care
c. welfare
d. economics
e. criminal justice
b. health care
Worries about international competition often lead domestic producers to call for _____. ON TEST
a. anti-trust legislation.
b. an international trade injunction
c. a monopoly
d. protectionism
e. a value-added tax
d. protectionism
Which of the following is true with respect to Keynesian economic policy?
a. Keynesian economic policy relies on government taxes and adjustments to the money supply to control inflation and unemployment.
b. Keynesian economic policy relies on taxation and expenditures by government to control unemployment.
c. Keynesian economic policy uses the money supply to control inflation and unemployment.
d. Keynesian economic policy can only be used by the federal government.
e. Keynesian economic policy can only be used by state-level governments.
b. Keynesian economic policy relies on taxation and expenditures by government to control unemployment.
The Social Security program was adopted during what event or period? ON TEST
a. the Vietnam War
b. Watergate
c. the Reagan administration
d. the Great Society
e. the Great Depression
e. the Great Depression
The _________ provides an international forum for reaching trade agreements and
resolving disputes among its members.
a. GATT
b. NAFTA
c. SEC
d. VAT
e. WTO
e. WTO
Certain tariffs, limits on imported goods, and import regulations limit U.S. consumption of foreign products, which has contributed to the
a. federal funds rate
b. international tax expenditure
c. national debt
d. trade deficit
e. value-added tax
d. trade deficit
A government policy that attempts to manage the economy by controlling taxing and spending is called
a. deregulation
b. fiscal policy
c. monetary policy
d. protectionism
e. regulation
b. fiscal policy
A government policy that attempts to manage the economy by controlling the amount of money in circulation through interest rates is called
a. deregulation
b. fiscal policy
c. monetary policy
d. protectionism
e. stagflation
c. monetary policy
One criticism of government regulation of the economy is that the regulations themselves can raise the cost of economic activity, also known as a. compliance costs b. excise taxes c. labor injunctions d. tariffs e. value-added taxesa. compliance costsThe total market value of all goods and services produced in an area during a year is termed which of the following? a. greatest national product b. gross domestic product c. maximum national product d. minimum domestic product e. national income productb. gross domestic productWhich of the following constitutes the largest portion of the federal budget? ON TEST a. discretionary spending b. foreign aid c. homeland security d. mandatory spending e. military spendingd. mandatory spendingWhich of the following is a means-tested program? a. Social Security b. No Child Left Behind c. Medicare d. Temporary Assistance for Needy Families e. the Elementary and Secondary Education Actd. Temporary Assistance for Needy Families__________ is/are one of the most important tools that monetary policy uses to affect the overall economy. a. Labor regulations b. Foreign monetary investment. c. Government spending d. Interest rates e. Taxation ratesd. Interest ratesWhich of the following entities is responsible for setting the federal funds rate in the United States? ON TEST a. the Congress b. the Congressional Budget Office c. the Executive Office of the President d. the Federal Reserve Board e. the Office of Management and Budgetd. the Federal Reserve BoardAccording to Figure 13.3, where does most of the federal budget go? a. foreign aid b. human resources c. interest on the national debt d. national defense e. monetary policyb. human resourcesWhat is the main purpose of monetary policy? a. to affect how much money is available to businesses and banks b. to control the amount of public debt sold to foreign states c. to control the interest rates on money lent to foreign states d. to equalize income disparity among citizens of the United States e. to expand the government's revenue base so as to reduce the deficit.a. to affect how much money is available to businesses and banksThe main goal of fiscal policy is _______. a. to affect how much money is available to foreign governments for investment and its cost b. to affect how much money is available to state governments for capital projects c. to determine how much interest the government will pay on the federal debt d. to stimulate the economy by increasing the number of exports into the United States e. to use taxes and government spending to help stimulate or slow down economic growthe. to use taxes and government spending to help stimulate or slow down economic growthLaissez-faire economics holds which of the following to be true? a. The government should actively intervene in the economy. b. The government should not take an active role in the economy. c. The government should do everything possible to reduce unemployment. d. The government should lower interest rates during a recession. e. The government should raise interest rates during a recession.b. The government should not take an active role in the economy.Which of the following is an example of corporate social responsibility? a. antitrust legislation b. boycotting a product that is dangerous to the environment c. collective bargaining d. encouraging employees to volunteer by giving them extra days of paid leave e. issuing an environmental impact statementd. encouraging employees to volunteer by giving them extra days of paid leaveWhich of the following is one way that the federal government seeks to promote economic growth? a. boosting the trade deficit b. enforcing the value-added tax c. imposing compliance costs d. offering subsidies e. outlawing labor injunctionsd. offering subsidiesWhat is the purpose of deregulation in the American political economy? a. Deregulation seeks to increase the barriers to economic productivity. b. Deregulation seeks to increase the political power of labor unions. c. Deregulation seeks to increase the power of large economic monopolies. d. Deregulation seeks to remove inefficient barriers in the collection of taxes. e. Deregulation seeks to remove inefficient barriers to productivity and growth.d. Deregulation seeks to remove inefficient barriers in the collection of taxes.Regulatory legislation at the start of the twentieth century primarily dealt with. a. business monopolies b. education c. labor unions d. technology e. the environmenta. business monopoliesThe primary purpose of the General Agreement on Tariffs and Trade (GATT) was to _____. a. establish the largest geographical free trade zone in the world b. prevent monopolies, break up those that exist, and ensure competition c. reduce the annual budget deficit d. reduce the national debt e. set the rules of free trade among member nationsb. prevent monopolies, break up those that exist, and ensure competitionThe annual shortfall between federal revenues and expenditures is known as which of the following? a. the balance of payments b. the budget deficit c. the expenditure difference d. the national debt e. the trade deficitb. the budget deficitWhich of the following is most accurate regarding the future of Social Security? a. Social Security will likely need adjustments to meet future demands. b. Social Security is expected to run out of money by 2014. c. Social Security is expected to be financially stable for the next 50 years. d. Social Security is expected to be financially stable for the next 100 years. e. Social Security will be replaced by a private investment program beginning in 2015.a. Social Security will likely need adjustments to meet future demands.In general, a recession does which of these? a. generates a response by state governments b. generates a response by the federal c. lasts at least a year d. leads to higher inflation e. reduces the unemployment levelb. generates a response by the federalWhich of the following is true of the federal government's role in education? a. The federal government never plays a role in education. b. The federal government is the primary governmental level involved in education. c. The federal government has only been involved in education since the year 2000. d. The federal government takes over underperforming schools. e. The federal government addresses issues of inequality and ensures that standards are met.e. The federal government addresses issues of inequality and ensures that standards are met.Which of the following provides one explanation for why Medicare costs have risen in recent years? a. People now are in better health than were people in the past. b. People rely on their own private insurance to supplement Medicare. c. Most people on Medicare also receive Medicaid benefits. d. Doctors charge less for many services than they did in the past. e. People live longer today than they did in the past.e. People live longer today than they did in the past.U.S. monetary policy involves which of the following? a. import and export policies b. interest rates and the money supply c. supply-side economics d. NAFTA and the balance of trade with Canada e. the national debt and the annual deficitb. interest rates and the money supplyWhich of these resulted from the Great Depression? a. The federal government cut Social Security benefits because it lacked adequate funds. b. The federal government assumed new responsibilities for the management of economic matters. c. The states assumed new responsibilities for the management of national economic matters. d. The federal government devolved responsibility for solving the economic crisis to the states. e. The federal government took a laissez-faire approach when dealing with economic matters.b. The federal government assumed new responsibilities for the management of economicWhat two measures of economic performance do Congress and the president rely upon to guide their economic decisions? a. the federal funds rate and inflation b. the gross domestic product and the Consumer Price Index c. inflation and the unemployment rate d. the national debt and the trade deficit e. the unemployment rate and interest rates.c. inflation and the unemployment rateIf the Federal Reserve Board needed to slow the economy down, it would most likely a. lower interest rates to increase the money supply b. lower taxes to increase the level of employment c. increase government spending to increase the money supply. d. raise interest rates to decrease the money supply. e. raise taxes to increase the money supply.d. raise interest rates to decrease the money supply.Which description best defines the social safety net? a. government responses to continuing social problems b. active government intervention based on public demand c. government programs to prevent homelessness and hunger d. government responses to crime and terrorism e. government assistance during economic downturnsa. government responses to continuing social problemsGenerally, regulations exist to ___________. ON TEST a. create advantages for certain economic classes in America b. control the effects of liberal public interest group lobbies c. control the behavior of corporations, other governments, or citizens d. make it difficult for businesses to make a profit e. stifle political competition and allow for the creation of monopoliesc. control the behavior of corporations, other governments, or citizensWhich of the following provides the greatest source of revenue for the federal government? a. individual income taxes b. Medicaid taxes c. regressive taxes d. Social Security taxes e. taxes on cigarettesa. individual income taxesIn an economic slowdown, Keynesian economic policy would advocate a. decreasing inflation b. increasing government spending c. increasing the money supply d. increasing the unemployment rate e. raising interest ratesb. increasing government spendingWhich of the following could be seen as evidence in support of the passage of the Affordable Care Act, colloquially known as Obamacare? a. Private insurance companies are adequate to provide health care coverage to nearly all Americans. b. Uninsured Americans have access to health care because hospitals are required to treat patients with life-threatening conditions. c. Health care costs have risen substantially over the past few decades. d. Health care costs have remained stable over the past few decades. e. Health care costs have declined over the past few decades.c. Health care costs have risen substantially over the past few decades.If Congress adopts a policy to make cars more fuel efficient, they have adopted a a. fiscal stimulus policy b. microeconomic policy c. monetary policy d. regulatory policy e. supply-side economic policyd. regulatory policyCompared to other nations such as Russia and Sweden, the United States has than many of its competitors. a. a higher GDP b. fewer rules c. higher taxes d. lower interest rates e. more regulationb. fewer rulesWhich of these is most consistent with the philosophy of Keynesianism? a. interest rate increases by the Federal Reserve b. government actions to increase debt owned by foreign countries c. government decisions to increase the money supply d. government provision of the 2008 federal stimulus package. e. deregulation efforts of President Reagan in the 1980sd. government provision of the 2008 federal stimulus package.Which of the following is accurate with regard to the national debt? a. The national debt as a percentage of GDP has drastically increased in recent years. b. The national debt as a percentage of GDP has not changed in the past decade c. The national debt is a product of balanced federal budgets. d. The national debt is not affected by external events such as war or a natural disaster. e. The national debt has only increased under Democratic presidents.a. The national debt as a percentage of GDP has drastically increased in recent years.Which statement most closely describes the way in which individuals are affected by the Federal Insurance Contribution Act? a. American citizens have the opportunity to purchase homes at a reduced interest rate. b. All Americans will now have to purchase health care insurance. c. Low-income workers are given a tax credit that allows them to collect a refund. d. Taxpayers have an amount deducted from their checks that is larger than the amount of income tax paid. e. Citizens who need help can collect benefits for five years during their lifetime.d. Taxpayers have an amount deducted from their checks that is larger than the amount of income tax paid.Entitlement programs are designed to do which of the following? a. get the poor out of poverty b. help ensure equality in public school funding c. help provide income to low-earning households d. provide financial aid to poor college students e. provide benefits to all qualifying individualse. provide benefits to all qualifying individualsWhich of the following would be considered a regulatory policy? a. a social insurance policy b. a food safety policy c. a monetary policy d. a redistributive policy e. a federal stimulus policyb. a food safety policyWhy might implementation of the Patient Protection and Affordable Care Act be difficult? a. The federal government has the authority to implement the law under the commerce clause of the Constitution. b. The legislation affects only a small percentage of the population. c. Parts of the law requires the states to implement it. d. Many people are expected to ignore the law and pay the penalty for not obtaining insurance. e. The legislation will cover many unemployed persons.c. Parts of the law requires the states to implement it.If government wanted to help ensure economic competition, it might do which of the following? a. encourage the creation of natural monopolies b. pass anti-externality laws c. pass anti-trust legislation d. pass a stimulus package e. reduce interest ratesc. pass anti-trust legislationWhy might some businesses lobby for increased regulation by the federal government? a. because they do not know that regulations always hurt them b. to lower their overall tax rate b. to gain access to federal bureaucrats who will act in their interests d. to increase their profit margins to better serve the public good e. to protect themselves from domestic and foreign competitorse. to protect themselves from domestic and foreign competitorsWhich of the following explains why some people have suggested raising the eligibility age for Social Security? a. Social Security has had a surplus for the past decade. b. Social Security benefits have been cut in recent years. c. Social Security may not be sustainable without cutting benefits. d. Social Security may not be sustainable given the current number of children in the program. e. Social Security may not be sustainable given the number of poor people in the program.c. Social Security may not be sustainable without cutting benefits.Which of the following philosophical beliefs explains the federal government's comparatively limited role in welfare and health policies? a. a commitment to egalitarianism b. a commitment to rugged individualism c. a commitment to communitarianism d. a commitment to public assistance e. a commitment to social safety netsb. a commitment to rugged individualismWhat is the purpose of government regulation of the economy? ON TEST a. to increase the revenue collected by the federal government b. to increase the overall level of taxes paid by produces in the economy c. to increase the level of profits for multinational corporations d. to minimize the costs of doing business for corporations e. to minimize abuses and promote competitione. to minimize abuses and promote competitionAdvocates of aggressive monetary policy contend that the key factor affecting the economy's performance is a. the federal funds rate b. the GDP c. inflation d. the money supply e. tax expendituresd. the money supplyWhich of the following was the biggest contributor to the economic crisis that began in 2008? a. deregulation of the investment banking industry b. high levels of government spending c. increased wage demands by labor unions d. inflationary policies by the Federal Reserve e. massive increases in federal budget deficitsa. deregulation of the investment banking industryIf a government wanted to use monetary policy to increase economic growth, which of the following steps should be taken? a. Decrease interest rates to increase the amount of money in supply. b. Increase the amount of foreign currency kept on reserve in U.S. banks. c. Increase the amount of public revenue for investment by raising taxes. d. Increase the government spending on public works projects. e. Print a larger amount of money to increase the money supply.a. Decrease interest rates to increase the amount of money in supply.Given historical trends, which of these is most likely to happen in the near future? a. deep reductions in military spending b. elimination of social insurance programs c. increased regulation of the economy d. large reductions in the national debt e. massive reductions in entitlement spendingc. increased regulation of the economyOne business practice that has threatened the long-term U.S. economy is a. collective bargaining b. compliance funding c. corporate giving d. offshore outsourcing e. protectionismd. offshore outsourcingWhich of the following best describes the goal of social policy in general? a. to promote the welfare of people both at home and abroad b. to provide aid for those who are economically disadvantaged c. to promote the welfare of citizens through domestic programs d. to promote the welfare of the disadvantaged in developing countries e. to keep the nation secure by making sure poverty is eliminatedc. to promote the welfare of citizens through domestic programsIn enacting three new education programs in 1998 to help students finish high school, to provide funding for distance learning, and to improve teacher quality, what important fact did Congress acknowledge? a. The Constitution requires the government to ensure adequate education at all levels. b. Education interest groups and teachers' unions have become too powerful to ignore. c. There is a link between quality of primary and elementary education and college success. d. Students are dropping out of school because the quality of teaching is poor. e. Many rural students do not have access to adequate schools and good teachers.c. There is a link between quality of primary and elementary education and college success.Which of the following is an advantage of deregulation? a. Deregulation would decrease the inflationary pressures in the economy. b. Deregulation would increase the cost of economic activity. c. Deregulation would increase the need for businesses to hire attorneys. d. Deregulation would reduce compliance costs for business. e. Deregulation would strengthen American labor unions.d. Deregulation would reduce compliance costs for business.