Economics Unit 4

1. A goal of fiscal policy is

2. Decreasing government spending usually

3. The unemployment rate reflects the percentage of people

4. Which of the following is not a goal of fiscal policy?

5. When the economy is operating at point C, the Federal Reserve is most likely to follow

6. When the economy is operating at point C, the Federal Reserve may decrease the discount rate to

7. If unemployment is rising rapidly, the Federal Reserve would most likely

8. Imagine that unemployment increases to record levels. The economy is in

9. Imagine you read an article that says "economists agree we have seen the worst of the inflation rate impact and expect it to lower very soon." The economy is likely in

10. Use this image to answer the following question. In the business cycle phase marked B, economists expect

11. A graph of the business cycle over time most resembles a

12. As of 2009, an American worker earning minimum wage

13. In the diagram above, what will happen if the government sets the price for potatoes at Point B?

14. In the diagram above, what will happen if the government sets the minimum wage at Point B?

15. In the diagram above, what will happen if the government sets the price for Internet access at Point A?

16. The state legislature asks you to analyze several product markets for natural monopoly qualities. The legislature wishes to regulate one of the products to provide safer, more efficient, and standard quality to its citizens. Which product do you recommend?

17. An example of a natural monopoly product is

18. One benefit of regulating a natural monopoly is that

19. The accumulation of years of spending more money than is collected in revenues over several years creates a budget

20. When a government collects more revenue in one year than it spends, there is a budget

21. You are a representative to the U.S. Congress. The U.S. federal budget debt grew by one billion dollars each of the last five years. To correct this, you should support the budget that

22. Inflation is low and unemployment is high. The public is demanding action. Within the Federal Reserve, who has the power to act?

23. The Federal Reserve utilizes monetary policy to

24. Banks that are members of the Federal Reserve have the benefit of

25. The Federal Reserve's Board of Governors is responsible for