1. Contractionary fiscal policy includes: A) decreasing taxes. B) decreasing the money supply. C) decreasing government expenditures. D) increasing government expenditures. 2. Expansionary fiscal policy includes: A) increasing taxes. B) increasing the money supply. C) decreasing government expenditures. D) increasing government expenditures. 3. Which of the following assets is the MOST liquid? A) a $50 bill B) a $50 gift certificate C) 100 shares of stock D) an economics textbook 4. Money is any asset that: A) the government says is money. B) can easily be used to purchases goods and services. C) has a positive value. D) the government says is money and that has a positive value. 5. Suppose a group of people decided to set up their own economic system with cartons of milk serving as money. If we decided to use this "liquid asset" as our medium of exchange and all prices were measured in cartons of milk, milk would still not be a good form of money mainly because it would not be a good: A) medium of exchange. B) unit of account. C) store of value. D) near-money. 6. Money used to buy groceries is a: A) medium of exchange. B) reserve of wealth. C) unit of account. D) store of value. 7. The U.S. dollar in your pocket today is best described as: A) commodity money. B) near-money. C) fiat money. D) commodity-backed money.