1. What is fiscal policy and how does it affect the overall economy?

2. How did John Maynard Keynes's ideas about government intervention change economic policy?

3. What was the American Recovery Act of 2009 and what were its intended effects?

1. What are the three main forms of federal government revenue?

2. How do mandatory spending and discretionary spending differ in purpose and size?

3. Why are social insurance fees sometimes not counted as taxes despite being government revenue?

1. How does increased government spending affect aggregate demand and unemployment?

2. Why is there a lag between when Congress approves stimulus spending and when its effects appear?

3. How does a tax cut differ from government spending in its impact on aggregate demand?

1. What is the multiplier effect and how does it amplify the impact of government spending?

2. How do marginal propensity to consume and marginal propensity to save affect the multiplier?

3. Why does each successive round of spending from a stimulus have a smaller effect on GDP?

1. What is a transfer payment and how does it differ from government spending on goods and services?

2. Why is the tax and transfer multiplier less effective than the spending multiplier?

3. How does the marginal propensity to save affect the impact of transfer payments on GDP?

1. What is a recessionary gap and what fiscal policy approach is used to address it?

2. What are the three main tools of expansionary fiscal policy and which is most effective?

3. What is an inflationary gap and what fiscal policy approach is used to address it?

4. Why are tax increases rarely used as contractionary policy in the United States?