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QUESTION 1

Which of the following is true

A, A country can run a budget surplus while at the same time owing a national debt.

B, If the US runs a budget deficit, it must owe a national debt.

C, There was a brief period in the late 1990s when the US did not have a national debt.

D, Since the 1960s, the percentage of the US budget spent on Social Security has fallen.

QUESTION 2

If the US government runs a budget deficit

A, interest rates increase and as a result, investment rises.

B, interest rates fall as a result.

C, there is no effect on private borrowing.

D, private borrowing declines in response to higher interest rates.

QUESTION 3

Suppose a county government imposed at tax on individuals equal to 12% of their first $45,000 of income and 3% on income above $45,000. This would be an example of a

A, excise tax

B, proportional tax

C, regressive tax

D, progressive tax

QUESTION 4

Which of the following statements is true?

A, The United States. FEDERALgovernment has never run a budget surplus.

B, If a country runs budget deficits, interest payments on the country's national debt tend to increase.

C, An increasing national debt will necessarily be a burden on our children.

D, The taxes taken from your paycheck for the social security program are held until you retire and are then paid back to you dollar for dollar.

QUESTION 5

Which of the following is true of a Black Swan Event?

A, They are predictable by private investors

B, They are predictable by government forecasters

C, Economies can be easily protected from the damage caused by such events.

D, They have small, but incremental impacts on an economy.

E, None of the above