Question
Question 1
Question 2
Question 3
Question 4
Question 5
A) How does the federal government's fiscal policy affect the U.S. economy? (1 point)
The federal government implements tax and spending measures that affect employment, economic growth, and inflation.
The President issues executive orders to influence changes to consumer and business spending.
The House and Senate pass new laws and regulations that can make changes to wealth distribution.
Members of the federal government consult with banks to change interest rates and availability of lending.
A) Why is contractionary fiscal policy often not used by the federal government? (1 point)
Individual and corporate tax rates increase while spending for social programs decreases, both of which would lead the economy to slow down or contract.
Decreases in federal government revenue and increasing expenses cause large deficits and adds to the national debt, which put a strain on the economy.
The increased individual and corporate income taxes overheats the economy and increases inflation.
The increase in individual and corporate tax rates as well as government spending cause a slow down in the private sector economy.
A) What impact does an expansionary fiscal policy action, such as a tax cut, generally have on consumer and business spending? (1 point)
spending increases for both businesses and consumers
spending decreases for businesses and increases for consumers
spending increases for businesses and decreases for consumers
spending decreases for both businesses and consumers
A) What is considered healthy economic growth for fiscal policy in terms of percent of Gross Domestic Product (GDP) per year? (1 point)
0% to 1%
3% to 4%
2% to 3%
4% to 5%
A) The economy is doing well but prices for goods and services are increasing at a faster pace. Determine the course of action that could be taken to help the economy by slowing down the rate of price
increases for goods and services. (1 point)
An expansionary fiscal policy involving cuts to individual tax rates and increased investments in infrastructure could be used to strengthen the economy.
An expansionary fiscal policy involving increases to corporate tax rates and increased payments to people who receive entitlements could be used to help with inflation.
A contractionary fiscal policy involving decreases to individual and corporate tax rates as well as infrastructure projects and subsidies could be used to weaken the economy.
A contractionary fiscal policy involving increases in individual and corporate tax rates as well as cuts to subsidies and the number of government employees would help to slow inflation.
Question 2
Question 3
Question 4
Question 5
A) How does the federal government's fiscal policy affect the U.S. economy? (1 point)
The federal government implements tax and spending measures that affect employment, economic growth, and inflation.
The President issues executive orders to influence changes to consumer and business spending.
The House and Senate pass new laws and regulations that can make changes to wealth distribution.
Members of the federal government consult with banks to change interest rates and availability of lending.
A) Why is contractionary fiscal policy often not used by the federal government? (1 point)
Individual and corporate tax rates increase while spending for social programs decreases, both of which would lead the economy to slow down or contract.
Decreases in federal government revenue and increasing expenses cause large deficits and adds to the national debt, which put a strain on the economy.
The increased individual and corporate income taxes overheats the economy and increases inflation.
The increase in individual and corporate tax rates as well as government spending cause a slow down in the private sector economy.
A) What impact does an expansionary fiscal policy action, such as a tax cut, generally have on consumer and business spending? (1 point)
spending increases for both businesses and consumers
spending decreases for businesses and increases for consumers
spending increases for businesses and decreases for consumers
spending decreases for both businesses and consumers
A) What is considered healthy economic growth for fiscal policy in terms of percent of Gross Domestic Product (GDP) per year? (1 point)
0% to 1%
3% to 4%
2% to 3%
4% to 5%
A) The economy is doing well but prices for goods and services are increasing at a faster pace. Determine the course of action that could be taken to help the economy by slowing down the rate of price
increases for goods and services. (1 point)
An expansionary fiscal policy involving cuts to individual tax rates and increased investments in infrastructure could be used to strengthen the economy.
An expansionary fiscal policy involving increases to corporate tax rates and increased payments to people who receive entitlements could be used to help with inflation.
A contractionary fiscal policy involving decreases to individual and corporate tax rates as well as infrastructure projects and subsidies could be used to weaken the economy.
A contractionary fiscal policy involving increases in individual and corporate tax rates as well as cuts to subsidies and the number of government employees would help to slow inflation.
Answers
GPT-4o mini
### Answers to Questions
1. **How does the federal government's fiscal policy affect the U.S. economy?**
- **Correct Answer:** The federal government implements tax and spending measures that affect employment, economic growth, and inflation.
2. **Why is contractionary fiscal policy often not used by the federal government?**
- **Correct Answer:** Individual and corporate tax rates increase while spending for social programs decreases, both of which would lead the economy to slow down or contract.
3. **What impact does an expansionary fiscal policy action, such as a tax cut, generally have on consumer and business spending?**
- **Correct Answer:** spending increases for both businesses and consumers.
4. **What is considered healthy economic growth for fiscal policy in terms of percent of Gross Domestic Product (GDP) per year?**
- **Correct Answer:** 2% to 3%.
5. **The economy is doing well but prices for goods and services are increasing at a faster pace. Determine the course of action that could be taken to help the economy by slowing down the rate of price increases for goods and services.**
- **Correct Answer:** A contractionary fiscal policy involving increases in individual and corporate tax rates as well as cuts to subsidies and the number of government employees would help to slow inflation.
1. **How does the federal government's fiscal policy affect the U.S. economy?**
- **Correct Answer:** The federal government implements tax and spending measures that affect employment, economic growth, and inflation.
2. **Why is contractionary fiscal policy often not used by the federal government?**
- **Correct Answer:** Individual and corporate tax rates increase while spending for social programs decreases, both of which would lead the economy to slow down or contract.
3. **What impact does an expansionary fiscal policy action, such as a tax cut, generally have on consumer and business spending?**
- **Correct Answer:** spending increases for both businesses and consumers.
4. **What is considered healthy economic growth for fiscal policy in terms of percent of Gross Domestic Product (GDP) per year?**
- **Correct Answer:** 2% to 3%.
5. **The economy is doing well but prices for goods and services are increasing at a faster pace. Determine the course of action that could be taken to help the economy by slowing down the rate of price increases for goods and services.**
- **Correct Answer:** A contractionary fiscal policy involving increases in individual and corporate tax rates as well as cuts to subsidies and the number of government employees would help to slow inflation.