Question 1

The total cumulative amount the federal government owes to its creditors is known as

Accepted Answer

A)  a trade deficit.
B)  a budget deficit.
C)  the national debt.
D)  a credit imbalance.
E)  income disparity.

Question 2

Economic efficiency requires

Accepted Answer

A)  that the free market not be regulated by government.
B)  that the output of goods and services is the highest possible given the amount of input used to produce them.
C)  the economy to be organized around large firms.
D)  economic transactions to be fair to each party.
E)  economic transactions to be equal to each party.

Question 3

Monetary policy includes all of the following assumptions EXCEPT that

Accepted Answer

A)  the money supply is the key to sustaining a healthy economy.
B)  too little money in circulation contributes to inflation.
C)  too little money in circulation contributes to a slowdown in consumer buying.
D)  too little money in circulation contributes to a slowdown in production.
E)  too much money in circulation contributes to inflation.

Question 4

The $787 billion stimulus bill passed by Congress in 2009

Accepted Answer

A)  illustrated classic supply-side principles.
B)  focused primarily on lowering tax rates for businesses.
C)  was passed with strong bipartisan support.
D)  had almost no Republican support.
E)  was not necessary,according to most Democratic-leaning economists.

Question 5

What did Congress do in 1995 to reduce overregulation?

Accepted Answer

A)  It cut funding for regulatory agencies like the EPA and Securities and Exchange Commission.
B)  It passed the Airlines Deregulation Act,which eliminated government-set airfares and the requirement that airlines provide service to smaller-sized cities.
C)  It restricted the president's ability to directly request administrative regulations from agency heads.
D)  It cut the budget of the Food and Drug Administration.
E)  It enacted legislation that prohibits administrators in some instances from issuing a regulation unless they can show that its benefits outweigh its costs.

Question 6

Who was appointed Fed chair in 2014?

Accepted Answer

A)  Ben Bernanke
B)  Milton Friedman
C)  Alan Greenspan
D)  Elizabeth Warren
E)  Janet Yellen

Question 7

The Fed chair

Accepted Answer

A)  is appointed by the president,with no approval from the Senate.
B)  serves a four-year term.
C)  rarely cares about monetary policy.
D)  has absolute authority over the Fed.
E)  All of these answers are correct.

Question 8

What has been the preferred strategy of U.S.lawmakers for combating the problem of global warming?

Accepted Answer

A)  reducing regulation on businesses to allow more private-sector solutions to develop creatively
B)  raising interest rates to slow down the economy
C)  business-tradable carbon tax credits
D)  reduction of carbon emissions
E)  alternative energy sources and energy conservation

Question 9

The Federal Reserve System

Accepted Answer

A)  was created in 1933.
B)  is run by a congressional committee.
C)  regulates only national banks.
D)  was created specifically to conduct fiscal policy.
E)  None of these answers is correct.

Question 10

________ wrote Silent Spring (1962) .

Accepted Answer

A)  Al Gore
B)  George W.Bush
C)  Greenpeace
D)  Rachel Carson
E)  The Sierra Club D

Question 11

Keynesian economics emphasizes ________ as a means of curtailing economic downturns.

Accepted Answer

A)  reduced taxes
B)  increased government spending
C)  decreased regulation
D)  decreased inflation
E)  increased taxes

Question 12

The Tennessee Valley Authority is

Accepted Answer

A)  an electricity industry owned by the United States.
B)  a private industry regulated by the United States.
C)  a private electricity industry exempt from government regulation.
D)  a private environmental organization that receives federal funding.
E)  a private environmental organization with power to regulate industry.

Question 13

If the economy is sluggish,with low productivity and high unemployment,the fiscal policy action on the demand side would be to

Accepted Answer

A)  increase taxes.
B)  cut business taxes.
C)  increase government spending.
D)  decrease government spending.
E)  None of these answers is correct.

Question 14

According to John Maynard Keynes's demand-side economic theory,an economic recession can be shortened through

Accepted Answer

A)  government spending programs.
B)  the natural workings of the free-market system.
C)  raising tariffs in the global economy.
D)  a determination on the part of government not to spend any more than it receives in taxes.
E)  tax cuts for the wealthy. A

Question 15

Fiscal policy is a mechanism the government employs to influence the economy.Fiscal policy is based on

Accepted Answer

A)  the idea that a balanced budget is the key to a healthy economy.
B)  the money supply.
C)  the government's taxing and spending decisions.
D)  the importance of maintaining a 12-month (fiscal year) economic cycle.
E)  the projections of the Federal Reserve Board.

Question 16

The Federal Reserve plays a large part in establishing ________ policy.

Accepted Answer

A)  monetary
B)  military
C)  fiscal
D)  budgetary
E)  security

Question 17

Government benefits for business include all of the following EXCEPT

Accepted Answer

A)  low-interest loans and government-guaranteed loans.
B)  corporate tax breaks.
C)  a national transportation system.
D)  minimum-wage laws.
E)  a national education system.

Question 18

Passed in 2010,the Dodd-Frank Wall Street Reform and Consumer Act

Accepted Answer

A)  loosens restrictions on large financial institutions considered "too big to fail."
B)  allowed low interest rates and small down payments for first-time home buyers and small business entrepreneurs.
C)  empowers government to more closely oversee financial activities.
D)  sought to promote environmental protection,consumer protection,and worker safety.
E)  required warning labels on all "hazardous" consumer goods,such as cigarettes. C

Question 19

Government support for agriculture in the form of price supports and income subsidies is designed PRIMARILY to

Accepted Answer

A)  increase farm production in order to meet the nation's food needs.
B)  stabilize farm income,which would otherwise fluctuate greatly due to market and weather conditions.
C)  promote farm conservation so as to preserve the productive capacity of U.S.agriculture.
D)  encourage rural development.
E)  encourage urban development.

Question 20

The creation of the Food and Drug Administration and the passage of the Securities and Exchange Act were intended to

Accepted Answer

A)  promote equity in the economy.
B)  eliminate the problem of externalities in the economy.
C)  destroy the legal foundation of the business trust.
D)  promote efficiency in the economy.
E)  None of these answers is correct.

Exam 15: Economic and Environmental Policy: Contributing to Prosperity

The total cumulative amount the federal government owes to its creditors is known as

Correct AnswerverifiedShow Answer

Economic efficiency requires

Correct AnswerverifiedShow Answer

Monetary policy includes all of the following assumptions EXCEPT that

Correct AnswerverifiedShow Answer

The $787 billion stimulus bill passed by Congress in 2009

Correct AnswerverifiedShow Answer

What did Congress do in 1995 to reduce overregulation?

Correct AnswerverifiedShow Answer

Who was appointed Fed chair in 2014?

Correct AnswerverifiedShow Answer

The Fed chair

Correct AnswerverifiedShow Answer

What has been the preferred strategy of U.S.lawmakers for combating the problem of global warming?

Correct AnswerverifiedShow Answer

The Federal Reserve System

Correct AnswerverifiedShow Answer

________ wrote Silent Spring (1962) .

Correct AnswerverifiedD

Keynesian economics emphasizes ________ as a means of curtailing economic downturns.

Correct AnswerverifiedShow Answer

The Tennessee Valley Authority is

Correct AnswerverifiedShow Answer

If the economy is sluggish,with low productivity and high unemployment,the fiscal policy action on the demand side would be to

Correct AnswerverifiedShow Answer

According to John Maynard Keynes's demand-side economic theory,an economic recession can be shortened through

Correct AnswerverifiedA

Fiscal policy is a mechanism the government employs to influence the economy.Fiscal policy is based on

Correct AnswerverifiedShow Answer

The Federal Reserve plays a large part in establishing ________ policy.

Correct AnswerverifiedShow Answer

Government benefits for business include all of the following EXCEPT

Correct AnswerverifiedShow Answer

Passed in 2010,the Dodd-Frank Wall Street Reform and Consumer Act

Correct AnswerverifiedC

Government support for agriculture in the form of price supports and income subsidies is designed PRIMARILY to

Correct AnswerverifiedShow Answer

The creation of the Food and Drug Administration and the passage of the Securities and Exchange Act were intended to

Correct AnswerverifiedShow Answer

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D

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A

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C

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