C11 Test

Regulation

The establishment, by the government, of rules aimed at influencing the behavior of firms and individuals.

Eminent domain

The power of a government to take an individual’s property for public use if the owner is fairly compensated.

Takings Clause

The — of he fifth amendment states, No person shall be…deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

Regulatory agency

A unit of government created to set and enforce standards for a particular industry or area of economic activity.

Price fixing

The illegal practice of — occurs when competitors agree on a price for a good or service.

Bet rigging

— occurs when competitors agree in advance who will submit the winning bid.

Market division

The tactic known as — occurs when competitors agree to divide a market among themselves.

Mergers

The combining of two or more separately owned firms into a single firm.

Regulatory captures

This “revolving door” between government and industry can lead to what economists call —.

Deregulation

The process of removing government restrictions on firms in order to promote competition or encourage economic activity.

Public provision

They do this through subsidies and —, which means providing the education itself.

Voucher

A — is a coupon to be used to purchase a specific good or service.

Command and control policies

Regulatory agencies that adopt — follow a similar approach, issuing rules that others are expected to follow.

Market based policies

Economists generally prefer the use of — to deal with negative externalities.

Cap and trade

Another market-based policy is known as —.

Pollution permits

The government then issues a limited number of — to every firm that emits that type of pollution.

Common resource

A resource that everyone has access to and that can easily be overused or destroyed.

Corrective tax

— give producers an incentive to reduce their harmful waste products because the tax acts as a penalty.

Tragedy of the commons

Economists call this problem the —.

Toll

One policy is to require everyone who uses a common resource to a pay a —, or fee.

Quota

A second way to preserve a common resource is to establish a —, or maximum amount of a resource that a person can use or consume in a given period of time.

privatize

A third way to deal with a tragedy of the commons is to turn the common resource into a private resource—that is, to — it.

Government failures

Economists describe situations in which government intervention leads to an inefficient use of resources as —

Logrolling

Or they may engage in — agreeing to vote for another lawmaker’s legislation if that lawmaker agrees to vote for their own legislation.

Economic stimulus

Congress enacted an — package, legislation specifically designed to stimulate business activity.

Quintiles

Then divides the entire list of households into five equal parts, called —.

Poverty rate

Another tool for measuring the distribution of income is the —. This rate is the percentage of households whose income falls below a certain dollar amount determined by the Census Bureau.

Poverty threshold

That dollar amount, called the —, is the estimated minimum income needed to support a family.

Economic mobility

A hallmark of American society is —.

Income redistribution

Since the 1960’s, most antipoverty programs have involved some form of —, a policy designed to reduce the gap between the rich and the poor.

Cash transfers

In come states, TANF benefits come in the form of —, or direct payments of cash from the government to individuals.

In kind transfers

These — include food stamps, public housing, school lunches, and medicaid.

Earned income tax credit

The government also helps the working poor through the —.

Unemployment insurance

Employers, through federal and state taxes, contribute to a fund that provides — for workers

Means tested programs

TANF, food stamps, medicaid, and the earned income tax credit are what economists call — that is, they are tied to family income.