Question 1

President Ronald Reagan embraced Keynesian economics in the 1980s.

Accepted Answer

President Reagan is known for implementing supply-side economic policies, which focus on reducing taxes and regulations to stimulate economic growth, rather than the government-led demand management approach of Keynesian economics.

Question 2

The Federal Reserve Board is in charge of fiscal policy in the United States.

Accepted Answer

The Federal Reserve Board is in charge of monetary policy, not fiscal policy. Fiscal policy is primarily determined by Congress and the President.

Question 3

Entitlements are government-sponsored programs, such as Medicare and Medicaid, which provide benefits to qualifying individuals.

Accepted Answer

Entitlements are government-sponsored programs that provide benefits to qualifying individuals.

Question 4

The presidency as an institution gained more budgetary power in the United States starting in 1921.

Accepted Answer

The Budget and Accounting Act of 1921 established a centralized budgeting system, giving the presidency greater control over the budget process and increasing its budgetary power.

Question 5

Payroll taxes are regressive.

Accepted Answer

Payroll taxes are regressive because they are based on a fixed percentage of income, rather than ability to pay. This means that lower income earners pay a higher percentage of their income in payroll taxes compared to higher income earners.

Question 6

Under the Constitution, the president has the power of the purse.

Accepted Answer

The Constitution gives Congress the power of the purse, meaning the authority to control and allocate government spending. The president may propose a budget, but it is up to Congress to approve and appropriate the funds.

Question 7

Democrats have traditionally sought to change the Social Security system to partial privatization so that the trust fund does not decrease and go bankrupt.

Accepted Answer

This statement is false. Democrats have typically opposed efforts to partially privatize Social Security and have instead sought to strengthen the program and ensure its solvency through various means, such as increasing payroll taxes or reducing benefits for higher-income earners.

Question 8

The assassination of President John F.Kennedy led to the passage of gun control legislation.

Accepted Answer

Following the assassination of President John F. Kennedy in 1963, public outcry and concern over the ease with which the assassin, Lee Harvey Oswald, had obtained his weapon led to the passage of the Gun Control Act of 1968 in the United States, which aimed to regulate firearms.

Question 9

Monetary policy is a shared exercise between the national government and the states.

Accepted Answer

Monetary policy is primarily the responsibility of the central bank, which is typically independent from the government and operates under its own mandates. While governments may have some influence over monetary policy through their appointment of central bank leaders and policy recommendations, the actual implementation and decision-making is largely separate from the government.

Question 10

Although many argue that employment is important for a healthy economy, the U.S.government has never made full employment an explicit goal of its economic policy.

Accepted Answer

The answer of Although many argue that employment is important...

Question 11

The Federal-State Unemployment Compensation Program was established in 1965 as part of the creation of Medicare.

Accepted Answer

The Federal-State Unemployment Compensation Program was actually established as part of the Social Security Act in 1935, not as part of the creation of Medicare in 1965.

Question 12

Budgetary spending that is required by law is called mandatory spending.

Accepted Answer

Mandatory spending is spending that is required by law and includes programs such as Social Security and Medicare.

Question 13

The U.S.Department of Education was created in 1856.

Accepted Answer

The U.S. Department of Education was actually created in 1980 through the Department of Education Organization Act, which was signed into law by President Jimmy Carter.

Question 14

Members of the baby-boom generation-a term used to describe individuals born between 1946 and 1964-will put a great deal of stress on the Social Security system when they retire.

Accepted Answer

This is because the baby-boom generation is a large group of people and as they retire, there will be a smaller pool of workers paying into the Social Security system, while a larger number of retirees are drawing benefits from it. This is expected to put a strain on the Social Security system.

Question 15

Defining a problem as an issue that requires the federal government's attention is the second stage of the policy-making process.

Accepted Answer

The second stage of the policy-making process is agenda setting, where issues are prioritized and selected for government attention. Defining a problem typically occurs in the first stage, problem identification.

Question 16

Social Security is the least popular social program in the United States.

Accepted Answer

According to several polls, Social Security consistently ranks as one of the most popular social programs in the United States.

Question 17

Each woman, man, and child in the United States in effect currently carries more than $55,000 of the national debt.

Accepted Answer

According to the latest data from the US Treasury, the total national debt was over $28 trillion as of September 2021, and the US population was over 331 million. Dividing the two numbers, each person in the US would carry over $84,000 of the national debt, not considering age or income differences. Therefore, the statement in the question is false.

Question 18

Fiscal policy has redistributive implications.

Accepted Answer

Fiscal policy involves government spending and taxation, which can affect the distribution of income and wealth in a society. For example, taxes may be used to fund social welfare programs that benefit low-income individuals, while government spending on infrastructure projects may benefit higher-income individuals who own businesses or property.

Question 19

Government regulation has a limited impact on the economy.

Accepted Answer

Government regulation can have a significant impact on the economy, whether through laws, taxes, subsidies, or other means. Regulations can affect businesses, industries, and individual consumers, and can influence the supply and demand of goods and services, as well as their costs. In some cases, regulations may be designed to promote economic growth, protect consumer rights, or achieve social and environmental goals. However, excessive or poorly designed regulations can also create barriers to entry, stifle innovation, and reduce competitiveness, ultimately hurting economic growth and prosperity.

Question 20

None of the social policies passed under the New Deal remain today.

Accepted Answer

Many of the social policies passed under the New Deal do remain today, such as Social Security, the minimum wage, and the FDIC.

Quiz 14: Economic and Social Policy