Fiscal Policy — Unit test Answers

Which of these is a banking activity of the Fed?

There are four stages in an economic recovery. 1. increased production2. rising demand (occurs twice)3. increased hiring In which order do these stages occur?

Which scenario best reflects the relationship between production and demand in a recession?

Hyperinflation can occur when

Which statement best describes why it is difficult to sell a home during a recession?

When production is very high but demand is very low, it can lead to

Money spent on government programs is referred to as

Which scenario is an example of cost-push inflation?

Which stage of the business cycle is an economy in when it reaches its low point?

Stagflation occurs when high inflation combines with

The Food and Drug Administration sets standards for

Which is the best definition of inflation?

Based on the taxing and spending cycle, how will changing expenditures affect taxes collected by the government?

Which is a function of regulatory agencies?

Sometimes an economy cannot grow because of external factors, such as

Which of the following is a characteristic of prosperity in the peak phase of the business cycle?

What gives Congress the power to raise taxes to fund services?

Typically, high inflation is a sign of

Which unemployment rate do most economists consider to be acceptable in the United States?

The graph shows how the federal budget grew between 1980 and 2010.