Question 1 (1 point) Social Security and Medicare are considered _____ liabiliti

Question

Question 1 (1 point)

Social Security and Medicare are considered _____ liabilities and are expected to _____ over the next generation.

Question 1 options:

a)

funded; rise

b)

unfunded; fall

c)

unfunded; rise

d)

funded; fall

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Question 2 (1 point)

Which one of the following is a reason the crowding-out effect could be mitigated?

Question 2 options:

a)

an increase in consumer consumption

b)

a decrease in tax revenues

c)

an increase in the saving rate

d)

deficit spending used for public investment

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Question 3 (1 point)

If the ultimate goal of fiscal policy aimed at aggregate supply is achieved, what happens to the aggregate price level and aggregate output?

Question 3 options:

a)

aggregate price level increases; aggregate output decreases

b)

aggregate price level decreases; aggregate output increases

c)

aggregate price level increases; aggregate output increases

d)

aggregate price level decreases; aggregate output decreases

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Question 4 (1 point)

If a government collects $550 billion in taxes and spends $700 billion, it would have a:

Question 4 options:

a)

surplus of $1,250 billion.

b)

deficit of $150 billion.

c)

deficit of $1,250 billion.

d)

surplus of $150 billion.

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Question 5 (1 point)

What did Arthur Laffer suggest President Reagan do in the 1980s?

Question 5 options:

a)

decrease income taxes

b)

increase corporate taxes

c)

increase welfare benefits

d)

increase income taxes

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Question 6 (1 point)

The fact that it takes a very long time for Congress to debate and enact fiscal policies such as a tax cut for low-income households is an example of a(n):

Question 6 options:

a)

decision lag.

b)

implementation lag.

c)

recognition lag.

d)

information lag.

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Question 7 (1 point)

The most important measure in determining whether a country's national debt is a significant problem is:

Question 7 options:

a)

the size of the debt in nominal terms.

b)

the proportion of the national debt that is held by government agencies.

c)

interest paid on the national debt as a portion of GDP.

d)

the interest rate paid on the debt.

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Question 8 (1 point)

If the national debt is $55 million and this year's deficit is $5 million, what would the new national debt be?

Question 8 options:

a)

$50 million

b)

$11 million

c)

$60 million

d)

$275 million

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Question 9 (1 point)

All of the following programs are considered mandatory spending EXCEPT:

Question 9 options:

a)

Social Security.

b)

interest on national debt.

c)

national defense.

d)

Medicare.

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Question 10 (1 point)

Suppose the government collected $3.2 trillion in tax revenues and spent $3.8 trillion, and discretionary spending was $1.5 trillion. For the government to fully balance the budget this year, how much discretionary spending needs to be cut?

Question 10 options:

a)

20%

b)

40%

c)

30%

d)

10%

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Question 11 (1 point)

Evidence has suggested that borrowing is _____ than taxation by politicians to finance fiscal policy spending, which has led to a(n) _____ of the federal government over the last few decades.

Question 11 options:

a)

more favored; contraction

b)

less favored; contraction

c)

more favored; expansion

d)

less favored; expansion

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Question 12 (1 point)

Reducing government spending, reducing transfer payments, or raising taxes describes which policy?

Question 12 options:

a)

contractionary fiscal policy

b)

expansionary fiscal policy

c)

monetary policy

Explanation / Answer

First question is answered below

1.

Correct option: (a) funded, rise

Reason: Medicare and social security are funded liabilities which are funded by US government as government expenditure and are expected to rise over the coming years because of ageing and increasing population in US.

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