Practice Quiz

Praxis II Early Education Content Knowledge

Category - Social Studies

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Which of the following best describes the term fiscal policy?
  1. The government’s way of using its power to tax and spend
  2. The government’s way to assure that every citizen makes enough money
  3. The government’s way to regulate the supply of money as well as interest rate levels
  4. None of the above.
Explanation
Answer: A - Fiscal policy is the government’s way of using its powers to tax and spend. For example, when the country is in a recession, the government can increase spending, reduce taxes, or both. Doing so can encourage consumers to spend more and encourage businesses to grow.
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