Unit 4 Chapter 30 Quiz Government Budgets and Fiscal Policy

What do goods like gasoline, tobacco, and alcohol typically share in common?

A. A progressive tax is imposed on each of them. B. A regressive tax is imposed on each of them. C. They are all subject to government excise taxes. D. They are all subject to government fiscal taxes. ''C''

A ________________________________ is calculated as a flat percentage of income earned, regardless of level of income.

A. progressive tax B. regressive tax C. proportional tax D. estate and gift tax ''C''

A ______________________ is created each time the federal government spends more than it collects in taxes in a given year.

A. budget deficit B. budget surplus C. corporate tax D. regressive tax ''A''

If the government for the state of Washington collects $65.8 billion in tax revenues in 2013 and total spending in the same year is $74.8 billion, the result will be:

A. an increase in payroll tax. B. an increase in excise tax. C. a budget surplus. D. a budget deficit. ''D''

If a country�s GDP decreases, but its debt increases during that year, then the country�s debt to GDP ratio for the year will _______________ in proportion to the magnitude of the changes.

A. decrease B. increase or decrease C. increase D. decrease because GDP decreased ''C''

If a government reduces taxes in order to increase the level of aggregate demand, what type of fiscal policy is being used?

A. discretionary B. contractionary C. standardized D. expansionary ''D''

Which of the following terms is used to describe the set of policies that relate to government spending, taxation, and borrowing?

A. financial policies B. monetary policies C. fiscal policies D. economic policies ''C''

A ______________________ means that government spending and taxes are equal.

A. fiscal budget B. balanced budget C. contractionary fiscal policy D. discretionary fiscal policy ''B''

If government tax policy requires Peter to pay $15,000 in tax on annual income of $200,000 and Paul to pay $10,000 in tax on annual income of $100,000, then the tax policy iS

A. optional. B. progressive. C. proportional. D. regressive. ''D''

A __________________________ policy will cause a greater share of income to be collected from those with high incomes than from those with lower incomes.

A. proportional tax B. regressive tax C. progressive tax D. excise tax ''C''