Ünite Sınavı Soruları

I. Crowding out is a phenomenon in which increased government expenditures replace private expenditures.

II. Crowding in is a situation in which decreasing government spending results in higher private investment.

III. Indirect crowding out occurs when a rise in government expenditures increases interest rates and as a result of this, private investment and/or consumption falls.

What can be said to be true about crowding out?

What is using taxation and government expenditure in order to achieve specific economic and social objectives?

I. Wage rigidity

II. Incomes policy

III. Indexation

Which of the given fiscal policies can be implemented in order to fight stagflation?

I. The difference between the government’s revenues and its spending is called the government’s
budget balance

II. Budget deficit refers to a situation in which the government’s revenues exceed the government’s expenditures.

III. Budget surplus refers to a situation in which the government’s expenditures exceed the government’s revenues. 

What can be said to be true about budget?

For the taxes to have stabilizing effects on the economy, how should the tax system be?

What is increasing government expenditures and decreasing interest and tax rates to invigorate the economy?

I. Discretionary fiscal policy is the alteration of government expenditures and/or taxes by the government to stabilize the fluctuations in the economy.

II. There are two types of discretionary fiscal policy: 1. Expansionary fiscal policy and 2. Contractionary fiscal policy.

III. Discretionary fiscal policy is convenient because it leads to rising debt ratios, and there is no time lag problem both in the decision-making and implementation process.

What can be said to be true about discretionary fiscal policy?

What is recognition lag?

I. Since inflation has negative effects on economies, fiscal policy can be used in order to solve this problem. 

II. Contractionary fiscal policy can be implemented by increasing government spending, decreasing taxes or a combination of these two actions. 

III. One policy option that can be used to reduce inflation is decreasing government expenditures.

What can be said to be true about Inflation and Fiscal Policy?

I. Fiscal policy is the government’s intervention to the economy in order to achieve specific economic and social goals by using fiscal tools.

II. Contractionary fiscal policy is increasing government expenditure, decreasing taxes or a combination of the two in order to increase economic activity.

III. Expansionary fiscal policy is decreasing government expenditure, increasing taxes or a combination of the two in order to decrease economic activity.

What can be said to be true about fiscal policy?