Government and Civil Service Government Budget and Fiscal Policy 2

Question 1

Mandatory spending differs from discretionary spending primarily because it:

Accepted Answer

Is funded automatically based on eligibility criteria established in permanent law

Answer

Cannot be reduced by any act of Congress under any circumstances

Answer

Is allocated exclusively to national defense and security programs

Answer

Requires annual reauthorization legislation to remain in effect

Question 2

The federal budget deficit is most accurately defined as:

Accepted Answer

The annual shortfall when federal expenditures exceed federal revenues in a fiscal year

Answer

The total accumulated debt owed by the federal government to all creditors

Answer

The amount of money the US borrows exclusively from foreign governments

Answer

The gap between mandatory and discretionary spending in a given year

Question 3

Entitlement programs are distinguished by the fact that:

Accepted Answer

Benefits are paid to all individuals who meet the legally defined eligibility criteria

Answer

They are funded through fixed annual appropriations that cannot exceed preset ceilings

Answer

They are allocated only to retired federal employees and veterans

Answer

They are discretionary allocations that Congress reviews and adjusts each fiscal year

Question 4

The Antideficiency Act primarily prohibits federal agencies from:

Accepted Answer

Spending or obligating funds in excess of amounts appropriated by Congress

Answer

Requesting annual budget increases of more than 10 percent over the prior year

Answer

Hiring new full-time employees without prior written OMB authorization

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Reprogramming funds between major program categories without notifying Congress

Question 5

A concurrent budget resolution passed by Congress:

Accepted Answer

Sets overall spending and revenue targets to guide the annual appropriations process

Answer

Legally appropriates funds directly to federal agencies and programs

Answer

Requires the President's signature before taking effect as law

Answer

Permanently amends existing authorization statutes for entitlement programs

Question 6

In federal appropriations, 'earmarks' are best described as:

Accepted Answer

Directed spending provisions that designate funds for specific projects or recipients

Answer

Funds set aside in a reserve account for emergency disaster relief

Answer

Reserved revenue streams legally dedicated to financing trust fund programs

Answer

Automatic cost-of-living adjustments applied annually to entitlement benefit levels

Question 7

In the federal legislative process, how do 'authorizations' and 'appropriations' differ?

Accepted Answer

Authorizations establish or continue programs and set funding ceilings; appropriations provide actual budget authority to spend

Answer

Authorizations directly fund programs; appropriations create the legal framework for them

Answer

Authorizations cover all mandatory spending; appropriations cover only discretionary spending

Answer

Authorizations are always permanent; appropriations always expire after exactly one fiscal year