Deck 1: Introduction to Public Finance in Canada

Question 1

In 2009, federal spending on protection of persons and property (which includes national defence)was larger than federal spending on health.

A)True
B)False
C)Uncertain

Answer 1

True

Question 2

A very small portion of government expenditures is financed by taxes.

A)True
B)False
C)Uncertain

Answer 2

False

Question 3

The federal budget is presented outlining anticipated changes in tax and spending.

A)several times throughout the year
B)every 4 years with the election of a new government
C)every time there is a tax change
D)each year

Answer 3

each year

Question 4

The federal government is required to finance all its expenditures by taxation.

A)True
B)False
C)Uncertain

Question 5

are exclusively the domain of provincial and local governments, and the federal government does not receive any revenue from this source.

A)Sales taxes
B)Property taxes
C)Payroll taxes
D)Personal income taxes

Question 6

About 25 percent of federal spending are transfers to provincial, territorial, and local governments.

A)True
B)False
C)Uncertain

Question 7

Over time, the economic role of government has

A)remained constant.
B)been too small to matter.
C)grown tremendously.
D)declined significantly.

Question 8

Key areas of provincial responsibility include

A)health.
B)welfare.
C)education.
D)all of these answers are correct.

Question 9

At the end of fiscal year 2014, the federal government's net public debt was around

A)$682 trillion.
B)$682 thousand.
C)$682 million.
D)$682 billion.

Question 10

In 2009, represented the largest portion of total government (all levels of government)spending

A)social services
B)health
C)protections of persons and property
D)education

Question 11

Inflation increases the real value of debt.

A)True
B)False
C)Uncertain

Question 12

Ideology is by itself to determine whether any particular economic intervention should be undertaken.

A)insufficient
B)sufficient
C)irrelevant
D)all that is needed

Question 13

Government bills to tax and to spend must originate in the Senate.

A)True
B)False
C)Uncertain

Question 14

In 2009, provincial and local governments received the largest amount of revenue from

A)sales taxes.
B)payroll taxes.
C)personal income taxes.
D)property taxes.

Question 15

The provincial role in public finance in Canada has grown significantly relative to that of the federal government.

A)True
B)False
C)Uncertain

Question 16

Education is

A)too expensive for the federal government.
B)financed on a voluntary basis.
C)generally financed at the provincial and local level.
D)generally financed at the federal level.

Question 17

The Constitution Act has provisions for local governments' taxing and spending powers.

A)True
B)False
C)Uncertain

Question 18

Health care has become an increasingly large portion of total government spending, due in part to an aging population.

A)True
B)False
C)Uncertain

Question 19

In 2009, the federal government received most of its revenue from

A)property taxes.
B)sales taxes.
C)personal income taxes.
D)payroll taxes.

Question 20

Property taxes are a major financing tool at the provincial and local government level.

A)True
B)False
C)Uncertain

Question 21

Why do/should we care that total government expenditures are becoming an increasingly smaller portion of GDP?

Question 22

One approach to measure the size of government is the volume of its annual expenditures.

A)True
B)False
C)Uncertain

Question 23

Expenditures, as a percentage of GDP for Canada, are not very different from those of other developed countries.

A)True
B)False
C)Uncertain

Question 24

Write an essay discussing some of the reasons that government expenditures for health care are increasing.

Question 25

In evaluating changes in the growth of government, economists take into account

A)population growth.
B)inflation.
C)size of the economy.
D)all of these answers are correct.

Question 26

If the size of government triples but at the same time the economy doubles, then the relative size of government has

A)no relevance.
B)shrunk.
C)remained constant.
D)grown.

Question 27

Discuss your views on government intervention regarding tobacco consumption.

Question 28

The federal government accounts for of government spending at all levels.

A)most
B)two-thirds
C)one-third
D)half

Question 29

Public finance

A)only works for local and provincial governments.
B)develops principles for understanding the government's taxing and spending activities.
C)is not like public economics.
D)all of these answer options are correct.

Question 30

Hidden costs to government include

A)tax expenditures.
B)accounting costs.
C)direct expenditures.
D)none of these answers is correct.

Question 31

Complications in the computation of government expenditures arise because

A)government provides goods that have no resale value.
B)secrets are kept about what is spent.
C)government is so large.
D)accounting decisions affect the outcome.

Question 32

Do you think it is correct policy that the federal government is not required to finance all of its expenditures with tax revenues and is allowed to borrow? What are the implications of this policy?