Test Your Knowledge on Fiscal Policy

Test Your Knowledge on Fiscal Policy

This quiz will test your understanding of fiscal policy, which involves government decisions on taxation and spending to influence the economy.

published on June 30
1/10

What is fiscal policy?

What is fiscal policy?
Government decisions on taxation and spending
Private sector investments
Monetary policy by central banks
2/10

What is the aim of expansionary fiscal policy?

What is the aim of expansionary fiscal policy?
Stimulate economic growth
Reduce inflation
Increase interest rates
3/10

Which of the following is an example of fiscal policy?

Which of the following is an example of fiscal policy?
Increasing government spending on infrastructure
Decreasing corporate tax rates
Raising interest rates
4/10

What do contractionary fiscal policies aim to do?

Reduce inflationary pressures
Boost consumer spending
Promote economic growth
5/10

Which of the following is not a tool of fiscal policy?

Which of the following is not a tool of fiscal policy?
Open market operations
Government spending
Taxation
6/10

What is the role of the government in fiscal policy?

What is the role of the government in fiscal policy?
Setting tax rates and determining public expenditure
Regulating financial markets
Controlling the money supply
7/10

Which type of fiscal policy is more likely to increase budget deficits?

Which type of fiscal policy is more likely to increase budget deficits?
Expansionary fiscal policy
Contractionary fiscal policy
Monetary policy
8/10

What is the primary goal of fiscal policy?

What is the primary goal of fiscal policy?
Achieving macroeconomic objectives
Stabilizing interest rates
Controlling inflation
9/10

How can fiscal policy affect income distribution?

How can fiscal policy affect income distribution?
Through changes in tax rates and social welfare programs
By manipulating foreign exchange rates
By setting minimum wage laws
10/10

What is the opposite of fiscal policy?

What is the opposite of fiscal policy?
Monetary policy
Supply-side economics
Keynesian economics