Can26L1

  • 1

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    Before World War II, the purpose of the federal budget was to ____________.

    stabilize the economy
    decrease unemployment
    finance the activities of the government
    maintain low interest rates

  • 2

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    Fiscal policy attempts to achieve all of the following objectives except _________.

    price level stability
    sustained long-term economic growth
    full employment
    a stable money supply

  • 3

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    Nova Scotia has an annual statement of the revenues and outlays of its provincial government together with the laws and regulations that approve or support those revenues and outlays. This statement is called the ___________.

    Provincial budget
    Halifax budget
    Nova Scotia budget
    Maritime budget

  • 4

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    When tax revenues exceed expenditures, the government has a _______, and when expenditures exceed tax revenues, the government has a _______.

    budget surplus; budget debt
    budget deficit; budget surplus
    budget surplus; budget deficit
    budget debt; budget surplus

  • 5

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    The government debt is equal to the _______minus _______.

    current deficit; the current surplus
    current surplus; the sum of past deficits
    sum of past deficits; the sum of past surpluses
    sum of past deficits; the current surplus

  • 6

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    A fall in income that results in a decrease in tax revenues is an example of ________________.

    discretionary fiscal policy
    a recession
    lump-sum taxes
    automatic fiscal policy

  • 7

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    An increase in the income tax rate is an example of ___________.

    discretionary fiscal policy
    an increase in government debt
    an increase in autonomous taxes
    an increase in the government deficit

  • 8

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    _______ taxes vary with _______, but _______ taxes do not vary with _______.

    Autonomous; GDP; induced; GDP
    Induced; real GDP; autonomous; real GDP
    Induced; real GDP; income; real GDP
    Autonomous; real GDP; autonomous; real GDP

  • 9

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    The amount by which a change in government expenditures on goods and services is multiplied to determine the change in equilibrium expenditure that it generates is the ___________________.

    slope of the AE curve
    government expenditures multiplier
    goods and services multiplier
    increase in real GDP

  • 10

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    The autonomous tax multiplier is ______________.

    positive
    equal to the government expenditures multiplier
    between 0 and 1
    negative

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