1.Monetary policy is the term used for the government policy regarding government spending, taxes, and government debt.

True

False

2.Anything that serves as a unit of account, a store of purchasing power, and a means of payment can be called money.

True

False

3.Fiscal policy is policy that is concerned with government purchases, taxes, and transfer payments.

True

False

4.The four principal components of aggregate demand do not include which of the following?

• Property values
• Net exports
• Government expenditures
• Planned investment

5.A decrease in consumer confidence tends to ________ aggregate demand. A decrease in business confidence will ________ aggregate demand.

• decrease; decrease
• decrease; increase
• increase; decrease
• increase; increase

6.Which of the following items is included in M2, but not in M1?

• Savings deposits
• Treasury bills (T-bills)
• Travelers checks
• Currency

7.Fiscal policy is policy that is concerned with government purchases, taxes, and transfer payments.

True

False

8.The M1 definition of the money stock focuses on the function of money as a means of payment.

True

False

9.An increase in net taxes will shift the aggregate demand curve to the right.

True

False