Week 14, Day 1 - Quiz 3

Week 14, Day 1 - Quiz 3 - QUIZ #3 This Quiz covers topics...

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QUIZ #3 This Quiz covers topics from chapters 12, 13, 14, and 15. Choose the correct answer (one choice) for each of the following questions. Note: Questions 1, 2, and 3 correspond to questions 22, 28, and 29 from Quiz #2. I've included these questions again because Midterm II did not cover the last section of Chapter 12. 1. The government's budget deficit has increased. The larger budget deficit a) must have been caused by the government implementing discretionary expansionary policy. b) must have been caused by the government implementing discretionary contraction policy. c) must have been caused by automatic stabilizers that increased the amount of transfers and decreased the amount of taxes. d) must have been caused by automatic stabilizers that decreased the amount of transfers and increased the amount of taxes. e) may have been caused by the government implementing discretionary expansionary policy or by automatic stabilizers that increased the amount of transfers and decreased the amount of taxes. f) may have been caused by the government implementing discretionary expansionary policy or by automatic stabilizers that decreased the amount of transfers and increased the amount of taxes. g) may have been caused by the government implementing discretionary contractionary policy or by automatic stabilizers that increased the amount of transfers and decreased the amount of taxes. h) may have been caused by the government implementing discretionary contractionary policy or by automatic stabilizers that decreased the amount of transfers and increased the amount of taxes. 2. If the government's budget surplus increased and the cyclically adjusted budget balance decreased, then a) automatic stabilizers must have been operating that increased the amount of transfers and decreased the amount of taxes and the government must have implemented discretionary expansionary policy. b) automatic stabilizers must have been operating that increased the amount of transfers and decreased the amount of taxes and the government must have implemented discretionary contractionary policy. c) automatic stabilizers must have been operating that decreased the amount of transfers and increased the amount of taxes and the government must have implemented discretionary expansionary policy. d) automatic stabilizers must have been operating that decreased the amount of transfers and increased the amount of taxes and the government must have implemented discretionary contractionary policy. 3. During a recession, the government's budget balance ________. If the government is required to keep its budget in balance, then it must undertake ________. a) increases, discretionary contractionary fiscal policies b) increases, discretionary expansionary fiscal policies c) decreases, discretionary contractionary fiscal policies d) decreases, discretionary expansionary fiscal policies Answer questions 4 and 5 using the following table, which shows information about the government's budgetary situation for two years. 4.
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Week 14, Day 1 - Quiz 3 - QUIZ #3 This Quiz covers topics...

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