How Fiscal Policy and Monetary Policy Affect the Economy


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What is the cyclical growth and decline of an economy called?

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1. Which of the following is the BEST explanation of how a government intervenes in an economy utilizing fiscal policy?

2. Which of the following is the BEST explanation of monetary policy?

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About This Quiz & Worksheet

This quiz and worksheet can help you assess your knowledge of monetary and fiscal policy. Topics you will be quizzed on include business cycles and government intervention.

Quiz & Worksheet Goals

This quiz/worksheet combo can help you assess your knowledge of:

  • Parts of the business cycle
  • Circumstances when a government intervenes in a fiscal economy
  • The definition of monetary policy
  • Ways the government can increase economic growth

Skills Practiced

  • Interpreting information - ensure that you can read information about fiscal policy and interpret it correctly
  • Knowledge application - access the knowledge you have gained regarding properties of monetary policy
  • Defining key concepts - ensure that you can accurately define main phrases, such as business cycle and fiscal policy

Additional Learning

Make sure to read the related lesson called How Fiscal Policy and Monetary Policy Affect the Economy. This lesson covers the following objectives:

  • Identify parts of the business cycle
  • Define fiscal policy
  • Compare and contrast a fiscal policy and a monetary policy
  • Learn about the roles of the Federal Reserve