Which of the following are among the main goals of monetary policy in the U.S.?

a.

Keeping both inflation and unemployment low

b.

Reducing budget deficits and the national debt

c.

Regulating the deposits and loans of commercial banks

d.

Balancing the international flow of funds and the net exports

Question43

Consider the following graph of the goods and services market, showing an increase in the aggregate demand curve as a result of expansionary monetary policy through the Fed purchasing bonds in the bonds market. Which of the following statements is true about why the aggregate demand curve increased?

a.

The increase in the supply of bonds caused an increase in the price bonds and the interest rate, thus stimulating government spending and net exports and increasing aggregate demand

b.

The decrease in the supply of bonds caused an increase in the price of bonds and a decrease in the interest rate, thus stimulating private investment and increasing aggregate demand

c.

The increase in the demand for bonds caused an increase in the price of bonds and the interest rate, thus stimulating government spending and net exports and increasing aggregate demand

d.

The increase in the demand for bonds caused an increase in the price of bonds and a decrease in the interest rate, thus stimulating consumption and investment and increasing the aggregate demand

Question44

Which of the following is the largest source of U.S. Federal revenues?

a.

Payroll taxes

b.

Property taxes

c.

Corporate income taxes

d.

Individual income taxes

Question45

Which of the following statements accurately differentiates a budget deficit and national debt?

a.

A budget deficit occurs every year; the national debt occurs every five years

b.

A budget deficit is the result of democratic control of Congress; national debt is something we can pay off next year

c.

A budget deficit occurs in one year when the government spends less than it receives; national debt is an accumulation of budget deficits over time

d.

A budget deficit occurs in one year when the government spends more than it receives; national debt is an accumulation of budget deficits over time