Question 1

The total value of all a nation's goods and services produced each year is called

Accepted Answer

The term used to describe the total value of all goods and services produced within a country is Gross Domestic Product (GDP).

Question 2

In 2015,the national debt rose to over $__________ trillion.

Accepted Answer

According to the US Treasury, as of March 2021, the national debt of the United States is over $28 trillion. Therefore, the closest answer to this question is C, which is 18 trillion. All the other options are much lower than the current national debt.

Question 3

According to the monetarist theory,inflation occurs when

Accepted Answer

According to the monetarist theory, inflation occurs when the government prints too much money, leading to an increase in the money supply and a decrease in the value of money. This is also known as "too much money chasing too few goods." As the supply of currency increases without a corresponding increase in the demand for goods and services, prices rise, leading to inflation.

Question 4

When voting on economic issues,most voters

Accepted Answer

The answer of  When voting on economic issues,most voters 
...

Question 5

A twentieth-century example of government use of money to influence elections was

Accepted Answer

Increasing Social Security benefits in election years is a known strategy used by some governments to gain favor with voters, particularly older voters who are more likely to benefit from such increases. This tactic is seen as a way to influence election outcomes by appealing to a significant portion of the electorate.

Question 6

The amount the government spends in excess of what it takes in each year is called the

Accepted Answer

The term used to describe the amount the government spends in excess of what it takes in each year is the deficit. Option A, national debt, refers to the total amount of money owed by the government. Options B and C, unbalanced fund and borrowed appropriation, are not commonly used terms to describe government spending. Option E, redline, is also not a term commonly used to describe government spending.

Question 7

As a general rule,Americans want

Accepted Answer

The answer of  As a general rule,Americans want 
...

Question 8

When voting behavior and economic conditions correlate at the national but not at the individual level,it can be said that the voters are

Accepted Answer

This phenomenon is known as sociotropic voting, where voters base their decisions on the overall economic conditions of the society, rather than their personal economic circumstances. This means that the voters are other-regarding and considering the welfare of the society as a whole, rather than just their individual interests.

Question 9

Public opinion strongly encourages American elected officials to

Accepted Answer

The answer of  Public opinion strongly encourages American elected officials...

Question 10

Americans generally support higher taxes that

Accepted Answer

Americans generally support the idea of higher taxes as long as they are paid by someone else, reflecting a common attitude towards taxation where individuals prefer not to bear the increased financial burden themselves.

Question 11

Americans generally __________ cutting spending on federal programs.

Accepted Answer

Americans generally oppose cutting spending on federal programs because they believe that these programs provide essential services to the public.

Question 12

Keynes would insist that there is no need for the government to

Accepted Answer

Keynesian economics suggests that balancing the budget annually is not necessary, especially during economic downturns, as government spending can help stimulate the economy.

Question 13

In 2011,Standard & Poor's,a credit ratings agency,issued

Accepted Answer

In 2011, Standard & Poor's issued a first-ever warning about America's national debt, stating that the country's credit rating was at risk due to its increasing debt burden.

Question 14

The health of the American economy creates __________ politics.

Accepted Answer

The health of the American economy creates majoritarian politics, where the benefits and costs are widely distributed, affecting the majority of the population.

Question 15

During a presidential election,people who think their own economic circumstances have deteriorated are more likely to vote

Accepted Answer

People who perceive their economic circumstances as having worsened are more likely to vote against the incumbent, regardless of the incumbent's party affiliation, as they may hold the current administration responsible for their economic dissatisfaction.

Question 16

When there is an economic downturn,this economic theory argues that the government should pump money into the economy by spending more than it collects in taxes.

Accepted Answer

This is a characteristic of Keynesian economics, which asserts that government intervention in the economy, particularly through fiscal policy such as increased government spending, can stabilize economic fluctuations.

Question 17

The huge new demands for Social Security benefits and medical payments under Medicare are largely due to

Accepted Answer

The increasing demand for Social Security benefits and medical payments under Medicare is mainly due to the population getting older. As the baby boomer generation ages, they are becoming eligible for these programs in large numbers, leading to an increase in demand for benefits.

Question 18

In normal economic times,this economic theory argues that the proper thing for government to do is to have a steady,predictable increase in the money supply at a rate about equal to growth in the economy's productivity.

Accepted Answer

The theory described is consistent with monetarist economics, which emphasizes the importance of controlling the money supply to maintain stable economic growth. Keynesian economics emphasizes government intervention to stimulate demand and employment, while economic planning involves centralized control of economic resources. Supply-side economics emphasizes reducing taxation and regulation to incentivize production and investment, and credit-based economics is not a commonly recognized economic theory.

Question 19

In the 2008 presidential election,71% of people who said that their financial situation had gotten worse voted for

Accepted Answer

Barack Obama was the candidate who campaigned with a message of hope and change, promising to improve the financial situation of struggling Americans. Therefore, it makes sense that a majority of those who felt their financial situation had worsened would vote for him in the 2008 election.

Question 20

Milton Friedman believed that inflation occurs

Accepted Answer

Milton Friedman believed that inflation occurs when too much money is in circulation in the economy, causing too much demand for too few goods and services, which results in a rise in prices. This is often referred to as demand-pull inflation. Friedman attributed this inflation to an increase in the money supply, which could be caused by a variety of factors including government policies, central banks, and changes in the private sector. Therefore, option C is the correct answer.

Quiz 18: Economic Policy Economic Policy