Question

question 8 of 14
identify all of the statements that are examples of fiscal policy.
□ there is an increase in income tax rates.
□ the federal reserve purchases bonds on the open market.
□ the estate tax is repealed.
□ government increases military spending.
□ public money is used to build a high - speed train that connects los angeles and las vegas.
□ the federal reserve increases the money supply by decreasing the reserve ratio requirement.
□ to help domestic firms, government sets a quota on the number of goods that can be imported.

Explanation:

Fiscal policy involves government spending and taxation.

• "There is an increase in income tax rates" is a tax change (fiscal).
• "The Federal Reserve purchases bonds..." is monetary policy (Fed actions, not fiscal).
• "The estate tax is repealed" is a tax change (fiscal).
• "Government increases military spending" is government spending (fiscal).
• "Public money is used to build a high - speed train" is government spending (fiscal).
• "The Federal Reserve increases the money supply..." is monetary policy (Fed reserve ratio change).
• "Government sets a quota on imports" is trade policy (not fiscal).

Answer:

• There is an increase in income tax rates.
• The estate tax is repealed.
• Government increases military spending.
• Public money is used to build a high - speed train that connects Los Angeles and Las Vegas.