Question 1

The consequences of legislation enacted to cancel budget authority previously provided by Congress before the time when the authority would otherwise lapse i.e., cease to be available for obligation) is called:
A) impoundment.
B) deferral.
C) rescission.
D) sequestration
e. None of the above.

Accepted Answer

The consequences described in the question are referred to as rescission. Impoundment refers to the act of withholding or delaying the expenditure of funds. Deferral refers to the delay of budget authority without canceling it. Sequestration refers to automatic, across-the-board spending cuts.

Question 2

Which agency is responsible for external audit of federal departments and agencies?
A) Congressional Budget Office CBO)
B) Government Accountability Office GAO.
C) U.S. Treasury Office of Fiscal Accounts TOFA.
D) Shared responsibility of all three

Accepted Answer

The Government Accountability Office (GAO) is the agency responsible for conducting external audits of federal departments and agencies. The Congressional Budget Office (CBO) provides budget analysis and economic forecasts, and the U.S. Treasury Office of Fiscal Accounts (TOFA) is responsible for financial management and accounting. While all three may have a role in overseeing federal spending and financial management, the GAO is specifically tasked with conducting audit engagements.

Question 3

A continuing resolution enables an agency to:
A) continue operations in a fiscal year, despite the fact that it overspent its appropriation for that fiscal year.
B) continue operations in a fiscal year, despite the fact that it overspent its appropriation for the prior fiscal year.
C) continue operations in a fiscal year, despite the fact that it has received no appropriation for that year.
D) negotiate its appropriations between the House and the Senate.

Accepted Answer

A continuing resolution allows an agency to continue operations in a fiscal year in the absence of an appropriations bill or if appropriations have not been finalized. It provides temporary funding to keep the agency operating until a full-year appropriations bill can be passed. It does not allow overspending or negotiating appropriations between the House and the Senate.

Question 4

Which of the following best describes the Congressional Budget resolution?
A) The budget submitted by the President to Congress
B) The formal appropriation of funds to agencies
C) The reconciliation of committee appropriations
D) Budget priorities established by Congress

Accepted Answer

The Congressional Budget resolution is a document that establishes budget priorities for the upcoming fiscal year and is adopted by Congress. It does not include specific appropriations for agencies or reconcile committee appropriations, and it is not a budget submitted by the President.

Question 5

In what decade was the first Congressional Budget?
A) 1790s
B) 1970s
C) 1860s
D) 1920s

Accepted Answer

The first Congressional Budget was established in the 1970s, specifically with the Congressional Budget and Impoundment Control Act of 1974. This act reformed the budget process by establishing a budget calendar and requiring Congress to adopt a budget resolution.

Question 6

Which statement about federal mandatory spending is accurate?
A) Because of its importance for the life of the nation, spending for the military is regarded as mandatory.
B) Because appropriation bills must pass for agencies to continue operations, all spending that must go through the full appropriation cycle is considered mandatory.
C) Spending for social security benefits is officially mandatory.
D) Any public program with strong political support is seen as mandatory.

Accepted Answer

Social security benefits are officially mandatory, meaning that they are not subject to the annual appropriations process and will continue to be funded unless Congress changes the law. Option A is incorrect because while defense spending is important, it is not officially designated as mandatory. Option B is incorrect because not all spending that goes through the appropriation cycle is considered mandatory. Option D is incorrect because political support does not determine whether spending is mandatory or discretionary.

Question 7

Which of the following would reduce the level of the net debt of the federal government?
A) Cut expenditure and raise revenue to reduce the deficit from $400 billion to $100 billion.
B) Balance the federal budget.
C) Run an annual surplus.
D) All of the above.

Accepted Answer

Running an annual surplus would directly reduce the net debt of the federal government, as it means the government is taking in more revenue than it is spending, allowing it to pay down existing debt.

Question 8

The Budget Control Act of 2011 did which of the following:
A) Provided for a balanced federal budget by fiscal 2013.
B) Established a PAYGO system for all federal tax and expenditure proposals.
C) Increased the federal debt ceiling.
D) Required that federal entitlement programs be reduced by 5 percent for the next three years.

Accepted Answer

The primary purpose of the Budget Control Act of 2011 was to increase the debt ceiling to prevent the United States from defaulting on its debt. In addition to raising the debt limit, the act also put in place automatic spending cuts (sequestration) to reduce the deficit, and it created a congressional Joint Select Committee on Deficit Reduction (also known as the "supercommittee") to propose further deficit reduction with a deadline for legislation to be enacted. The act did not provide for a balanced budget by a specific fiscal year, establish a PAYGO system for all federal tax and expenditure proposals, or require a 5 percent reduction in federal entitlement programs over the next three years.

Question 9

In what quarter of what fiscal year execution phase) is the Federal government today?
A) First quarter 201_
B) Second quarter 201_
C) Third quarter 201 _
D) Fourth quarter 201_

Accepted Answer

As of my knowledge cutoff in early 2023, the United States federal government's fiscal year begins on October 1 and ends on September 30 of the following year. To determine the current quarter of the fiscal year, you would need to know the current date. Here is how the quarters break down:

Question 10

Which of the following is not discretionary spending under the rules of BEA90?
A) Spending for the Department of Defense
B) Spending for the Social Security benefits
C) Spending for the Environmental Protection Agency
D) Spending for homeland defense

Accepted Answer

Under the rules of BEA90, discretionary spending is defined as spending that is subject to annual appropriations by Congress. Social Security benefits are considered mandatory spending, which means that the funding for these programs is automatically provided by law and is not subject to annual appropriations. Therefore, B is not discretionary spending under BEA90 rules. A, C, and D are discretionary spending under BEA90 rules.

Question 11

Suppose that when he took office in January 2009, President Obama wanted to
reduce the level of spending by the Drug Enforcement Administration during
fiscal 2009. What budget procedure would allow him to do that?
A) He had no legal way of doing this.
B) Executive transfers out of the Drug Enforcement Administration to the Department of Treasury Impoundment Fund
C) A rescission approved by Congress
D) None of the above

Accepted Answer

A rescission approved by Congress would allow President Obama to reduce the level of spending by the Drug Enforcement Administration during fiscal 2009. This would involve proposing legislation to Congress that would cancel or reduce funding previously approved for the agency. Executive transfers or impoundments would not be a legal or appropriate means to achieve this goal.

Question 12

Which of the following categories of federal government spending is the largest?
A) Human resources
B) Physical resources
C) International foreign. aid
D) National defense

Accepted Answer

Human resources, which includes spending on Social Security, Medicare, Medicaid, and other entitlement programs, is the largest category of federal government spending. This category encompasses a significant portion of the federal budget, reflecting the government's commitment to welfare and social insurance programs.

Question 13

The PAYGO budget requirement means:
A) that only programs generating revenues may be proposed for addition to the executive budget.
B) that legislation that would increase entitlement spending must be accompanied with an increase in revenue or reduction in spending sufficient to cover the new entitlement spending.
C) that debt refinancing must be approved by Congress.
D) that no tax reductions are permitted

Accepted Answer

The PAYGO (Pay-As-You-Go) budget requirement mandates that any legislation proposing an increase in entitlement spending must be accompanied by an increase in revenue or a reduction in spending to offset the additional expenditure. This ensures that any new spending is paid for without adding to the federal deficit.

Question 14

The Congressional Budget and Impoundment Act of 1974 had which of the following consequences?
A) Prohibited the presidential impoundment of federal funds.
B) Strengthened the role of the President.
C) Shortened the time between presentation of the President's budget and the start of the fiscal year.
D) None of the above.

Accepted Answer

The Congressional Budget and Impoundment Act of 1974 prohibited the presidential impoundment of federal funds. This means that the President could no longer refuse to spend funds that had been approved by Congress. The Act also established a formal budget process and strengthened Congress's role in the budgetary process, rather than strengthening the role of the President. The Act did not have any direct impact on the timing of the fiscal year.

Question 15

The most recent presidential budget that was presented to Congress with a planned surplus was presented by what President?
A) George W. Bush
B) Reagan
C) Nixon
D) Clinton

Accepted Answer

The most recent presidential budget that was presented to Congress with a planned surplus was presented by President Clinton. His 1999 budget projected a $69 billion surplus for fiscal year 2000.

Question 16

Impoundment occurs during which stage of the budget process?
A) preparation
B) adoption
C) execution
D) audit and evaluation

Accepted Answer

Impoundment occurs during the execution stage of the budget process, which is when the government starts spending the funds allocated in the budget. Impoundment refers to when the president or other executive officials withhold or delay funding that has been appropriated by Congress. This can happen for a variety of reasons, such as concerns about the expenditures being unnecessary or not in line with the administration's priorities. Impoundment can be a controversial issue, as it can undermine Congress's constitutional power of the purse.

Question 17

Which of the following is a means-tested entitlement program?
A) Medicare
B) Medicaid
C) Social Security
D) Temporary Assistance for Needy Families TANF.

Accepted Answer

Medicaid is a means-tested entitlement program, meaning that eligibility is based on income and assets.

Question 18

Which of the following is correct about the Government Accountability Office?
A) It prepares budgets for executive agencies under the direction of the President.
B) It reviews agency budget requests for the President.
C) It prepares audits and evaluations for the President.
D) It does not report to the President.

Accepted Answer

The Government Accountability Office (GAO) is an independent, nonpartisan agency that works for Congress. It investigates how the federal government spends taxpayer dollars, making it distinct in that it does not report to the President but rather to Congress. This independence is crucial for its role in overseeing federal expenditures and operations.

Question 19

The growth of Federal government spending in the last 30 years is primarily due to:
A) defense spending.
B) interest on the debt.
C) transfer payments.
D) education.

Accepted Answer

Transfer payments, such as Social Security, Medicare, and Medicaid, have been consistently growing over the last 30 years and are a significant factor in the increase of Federal government spending.

Question 20

Which of the following did the Balanced Budget and Emergency Deficit Control Act of 1985 do?
A) Require that actual federal outlays be no greater than receipts by 1991.
B) Require a decline in the federal debt, at least through 1991.
C) Establish declining deficit targets aiming toward a balanced budget in 1991.
D) Create an item veto.

Accepted Answer

The Balanced Budget and Emergency Deficit Control Act of 1985 established declining deficit targets aiming toward a balanced budget in 1991.

Quiz 3: Budget Methods and Practices

The consequences of legislation enacted to cancel budget authority previously provided by Congress before the time when the authority would otherwise lapse i.e., cease to be available for obligation) is called:

Which agency is responsible for external audit of federal departments and agencies?

A continuing resolution enables an agency to:

Which of the following best describes the Congressional Budget resolution?

In what decade was the first Congressional Budget?

Which statement about federal mandatory spending is accurate?

Which of the following would reduce the level of the net debt of the federal government?

The Budget Control Act of 2011 did which of the following:

In what quarter of what fiscal year execution phase) is the Federal government today?

Which of the following is not discretionary spending under the rules of BEA90?

Suppose that when he took office in January 2009, President Obama wanted to reduce the level of spending by the Drug Enforcement Administration during fiscal 2009. What budget procedure would allow him to do that?

Which of the following categories of federal government spending is the largest?

The PAYGO budget requirement means:

The Congressional Budget and Impoundment Act of 1974 had which of the following consequences?

The most recent presidential budget that was presented to Congress with a planned surplus was presented by what President?

Impoundment occurs during which stage of the budget process?

Which of the following is a means-tested entitlement program?

Which of the following is correct about the Government Accountability Office?

The growth of Federal government spending in the last 30 years is primarily due to:

Which of the following did the Balanced Budget and Emergency Deficit Control Act of 1985 do?