Review Part 16

1

• Review Part 16
• The Federal Budget

2

• 1) Which of the following institutions is given
  specific constitutional power of the purse?
• a. Office of Management and Budget
• b. President
• c. Congress
• d. Special interest groups
• e. Executive agencies

3

• 1) Which of the following institutions is given
  specific constitutional power of the purse?
• a. Office of Management and Budget
• b. President
• c. Congress
• d. Special interest groups
• e. Executive agencies

4

• 2) If Congress does not pass a budget by the
  beginning of the fiscal year, then which of the
  following takes place?
• a. The president can impose a budget to keep the
  government running
• b. The Courts can step in and create a temporary
  budget
• c. The Congress must pass a continuing
  resolution
• d. Government offices are automatically shut
  down
• e. A contingency budget goes into effect

5

• 2) If Congress does not pass a budget by the
  beginning of the fiscal year, then which of the
  following takes place?
• a. The president can impose a budget to keep the
  government running
• b. The Courts can step in and create a temporary
  budget
• c. The Congress must pass a continuing
  resolution
• d. Government offices are automatically shut
  down
• e. A contingency budget goes into effect

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• Explanation
• A continuing resolution prevents the government
  from shutting down if final passage of specific
  budget items are not approved by October 1st.
  Neither the president nor the Courts can
  intercede in this situation.

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• 3) The federal government may borrow money from
  all the following EXCEPT
• a. Trust funds
• b. Foreign investors
• c. Commercial banks
• d. Money market funds
• e. The United States Treasury

8

• 3) The federal government may borrow money from
  all the following EXCEPT
• a. Trust funds
• b. Foreign investors
• c. Commercial banks
• d. Money market funds
• e. The United States Treasury

9

• 4) As a result of President Nixons practice of
  cutting off funds for programs he felt would
  increase the budget,
• a. Congress passed the line item veto
• b. Congress passed the Congressional Budget and
  Impoundment Control Act
• c. The Supreme Court ruled the practice
  unconstitutional
• d. A balanced budget amendment was passed
• e. The Gramm-Rudman-Hollings Emergency Deficit
  Control Act was passed

10

• 4) As a result of President Nixons practice of
  cutting off funds for programs he felt would
  increase the budget,
• a. Congress passed the line item veto
• b. Congress passed the Congressional Budget and
  Impoundment Control Act
• c. The Supreme Court ruled the practice
  unconstitutional
• d. A balanced budget amendment was passed
• e. The Gramm-Rudman-Hollings Emergency Deficit
  Control Act was passed

11

• Explanation
• The Congressional Budget and Impoundment Control
  Act was passed in 1974 in order to stop the
  president from doing away with approved programs
  in the name of deficit reduction. It also
  streamlined the entire budgetary process. The
  line item veto was approved by both houses of
  Congress in 1995 but stalled in conference. The
  Supreme Court never ruled on the legality of
  Nixons actions.

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• 5) Which of the following components was part of
  President Reagans 1981 tax bill?
• a. A significant increase in the number of tax
  deductions allowed
• b. A decrease in the number of tax brackets
• c. A decrease in the deficit
• d. A larger tax cut for the lower class than the
  upper class
• e. An increase in the capital gains tax

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• 5) Which of the following components was part of
  President Reagans 1981 tax bill?
• a. A significant increase in the number of tax
  deductions allowed
• b. A decrease in the number of tax brackets
• c. A decrease in the deficit
• d. A larger tax cut for the lower class than the
  upper class
• e. An increase in the capital gains tax

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• Explanation
• Reagans historic tax plan resulted in a decrease
  of the number of tax brackets. It increased the
  deficit significantly. It also gave the upper
  class a disproportionate tax savings compared to
  the lower class.

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• 6) Over the past 20 years which of the following
  areas has shown the greatest increase in
  budgetary spending?
• a. The defense budget
• b. Federal operations
• c. Federal grants
• d. Discretionary spending
• e. Entitlements

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• 6) Over the past 20 years which of the following
  areas has shown the greatest increase in
  budgetary spending?
• a. The defense budget
• b. Federal operations
• c. Federal grants
• d. Discretionary spending
• e. Entitlements

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• 7) All the following areas gives the federal
  government the greatest amount of income?
• a. Income taxes
• b. Social Security and Payroll taxes
• c. Corporate taxes
• d. Luxury taxes
• e. Money collected from tariffs

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• 7) All the following areas gives the federal
  government the greatest amount of income?
• a. Income taxes
• b. Social Security and Payroll taxes
• c. Corporate taxes
• d. Luxury taxes
• e. Money collected from tariffs

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• 8) All the following are attempts at lowering
  the nations deficit EXCEPT
• a. The attempt to pass a balanced budget
  constitutional amendment
• b. A change in the welfare system forcing people
  to work
• c. The proposal to institute means testing in
  order to get Social Security
• d. The proposal to institute means testing for
  Medicare
• e. The creation of the National Service Program

20

• 8) All the following are attempts at lowering
  the nations deficit EXCEPT
• a. The attempt to pass a balanced budget
  constitutional amendment
• b. A change in the welfare system forcing people
  to work
• c. The proposal to institute means testing in
  order to get Social Security
• d. The proposal to institute means testing for
  Medicare
• e. The creation of the National Service Program

21

• 9) According to many pollsters, a defining event
  that voters remembered during the 1992
  presidential campaign was
• a. President Bushs no new tax pledge
• b. President Bushs handling of the Gulf War
• c. President Bushs success in vetoing
  Democratic spending proposals
• d. President Bushs proclamation that the cold
  war was over
• e. President Bushs agreements with Russia to
  destroy nuclear weapons

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• 9) According to many pollsters, a defining event
  that voters remembered during the 1992
  presidential campaign was
• a. President Bushs no new tax pledge
• b. President Bushs handling of the Gulf War
• c. President Bushs success in vetoing
  Democratic spending proposals
• d. President Bushs proclamation that the cold
  war was over
• e. President Bushs agreements with Russia to
  destroy nuclear weapons

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• The End