If Policy Makers Wanted to Use Both Monetary and Fiscal

question 20

Multiple Choice

If policy makers wanted to use both monetary and fiscal policy to stimulate demand and reduce a high rate of unemployment, which of the following would be most appropriate?

• A)​A larger budget deficit and the purchase of securities in the open market by the Fed
• B)​A government surplus and the sale of securities in the open market by the Fed
• C)​A larger government deficit and an increase in the discount rate
• D)​A larger government surplus and a reduction in the discount rate

Assess and respond to ethical considerations in managerial decisions related to budgeting and performance evaluation.

Understand how to calculate and interpret return on investment (ROI).

Grasp the concepts and purposes of different types of budgets, including static and flexible budgets.

Identify and distinguish between various management and control concepts such as budgetary control, responsibility accounting, and management by exception.

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Definitions:

Consumer Surplus

Consumer Surplus is the difference between the highest price a consumer is willing to pay for a good or service and the actual price they pay.

Tax

A mandatory financial charge or some other type of levy imposed on a taxpayer by a governmental organization in order to fund government spending and various public expenditures.

Reduction

The act of making something smaller or less in amount, degree, or size.

Sellers

Individuals or entities that offer goods or services for sale to consumers or other businesses, participating in economic transactions.