Connell Exam 3 Study Guide

Businesses take risks and learn what people want as a result of:

1. TRIAL AND ERROR

Failure is acceptable to the extent that:

CHANGE IS POSSIBLE

Describe the first stage of the US economy - place and activity.

RURAL FARMERS

Describe the second stage of the US economy - place and activity.

BIG CITY FACTORY WORKERS

Describe the third stage of the US economy - place and activity.

SUBURBAN KNOWLEDGE WORKERS IN OFFICES

Compared to farms and factories, service sector jobs are:

CLEAN, HEALTHY, & HIGH PAYING

What entrepreneur changed the world by making an overland trip to China in 1271.

MARCO POLO

What were the economic problems associated with this trip?

SLOW AND EXPENSIVE - MANY BANDITS

What exciting new products did this trade bring to Europe?

SILKS, SPICES AND GUNPOWER

What other Italian entrepreneur wanted to compete with a new idea and what was the idea?

COLUMBUS HAD A NEW IDEA THAT WORLD WAS ROUND AND THAT YOU COULD GET TO THE EAST BY SAILING WEST

What rich person invested in this venture and why?

KING OF SPAIN. TO GET FIRST PICK OF NEW LANDS

What did Spain pick and why?

SUGAR AND GOLD - MONEY - CENTRAL AND SOUTH AMERICA SPEAK SPANISH

What nation got second pick and what did they pick?

ENGLAND PICKED TOBACCO AND FUR AND LUMBER

What was the financial reason for most English settlements in America?

ENGLISH INVESTORS PUT UP THE MONEY FOR SETTLEMENTS EXPECTING PROFITS.

JOINT STOCK VENTURE COMPANIES

What was the cause of the French and Indian War?

COLONISTS WANTED VALUABLE MIDWEST FARMLAND

What were the three "mercantilism" reasons for the Revolutionary War?

1) ENGLAND WANTED TAXES TO REPAY THE COST OF THE FRENCH AND INDIAN WAR. 2) ENGLAND WOULD NOT LET AMERICANS MANUFACTURE CLOTH, BEER OR CIGARS. 3) ENGLAND WOULD NOT LET AMERICANS TRADE WITH SPAIN AND FRANCE.

In 1776, a Scottish "innovation" changed the world. Name that Innovation, the Document, the Author, and the type of Liberty.

CAPITALISM - "WEALTH OF NATIONS" - ADAM SMITH - ECONOMIC LIBERTY

In 1776, an American "innovation" changed the world. Name that Innovation, the Document, the Author, and the type of Liberty.

DEMOCRACY - DECLARATION OF INDEPENDENCE - THOMAS JEFFERSON - POLITICAL LIBERTY

Name concept that kings are better than ordinary people and can do anything they want?

DEVINE RIGHT OF KINGS

What are the three radical new phrases in the Declaration of Independence that changed the world?

ALL MEN ARE CREATED EQUAL - GOD-GIVEN RIGHTS - CONSENT OF THE GOVERNED

If"All Men Are Created Equal", then it is acceptable for common soldiers in the Revolutionary War to:

SHOOT AN OFFICER

What does "E Pluribus Unum" mean?

FROM MANY ONE - FROM MANY STATES INTO ONE NATION

What is the first unifying clause in the Constitution?

COMMERCE CLAUSE - FREE TRADE UNIFIES THE TRADERS

What is the second unifying clause in the US Constitution?

SUPREMACY CLAUSE - ALL STATES MUST OBEY THE FEDERAL GOVERNMENT - EVERYONE OBEYING TOGETHER UNIFIES PEOPLE

What is the third unifying clause in the US Constitution?

FULL FAITH AND CREDIT CLAUSE - STATES MUST RESPECT EACH OTHERS LAWS - EVERYONE RESPECTING EACH OTHER UNIFIES PEOPLE

The Commerce Clause mandates the free movement of three things between states. Name them.

GOODS, PEOPLE, IDEAS

Because of the free movement of the items above the US is known as:

THE GREAT MELTING POT

The Commerce Clause mandates the creation of the:

WORLD'S FIRST FREE TRADE ZONE

Washington refused the chance to be king, so the King of England called him:

THE GREATEST MAN IN THE WORLD

How many of the original 13 colonies voted in the first federal election in 1788?

TEN STATES

The idea that ordinary people can run a government without a King/General/Caesar is call.

THE GREAT EXPERIMENT

"Consumer Sovereignty" means consumers are king and they exercise control over the economy with their:

DOLLAR VOTES

What bargain land purchase doubled the size of the USA?

THE LOUISIANA PURCHASE

What is the name of water super-highway completed in 1825?

ERIE CANAL

What two cites were the end-points of the water super-highway and how did they grow?

NEW YORK AND CHICAGO BECAME THE FIRST AND SECOND LARGEST US CITIES

What is the name of money such as gold, silver, nails and tobacco that had a useful purpose?

COMMODITY MONEY

37. Paper "convertible money" could be converted into _______ or __________

GOLD OR SILVER

Soft gold Spanish Doubloons could easily be cut in ______ pieces; and each piece was called __ _____ ; and a nickname for a quarter of a dollar is ____ ____.

EIGHT PIECES - A BIT - "TWO BITS"

The value of a gold or silver coin was determined by its ______

WEIGHT

Pieces of paper that must be accepted in trade because there is a law mandating such acceptance is called " ______ money" and the paper is known as "Legal ________

FIAT; TENDER

41. What are the two "types of money" and the characteristics of each.

PUBLIC MONEY IS ISSUED BY GOVERNMENT (DOLLARS) - TANGIBLE AND ANONYMOUS. PRIVATE MONEY IS ISSUE BY NON-GOVERNMENT INSTITUTIONS (CHECKS, VENMO, BITCOIN) - INTANGIBLE AND TRACABLE

The US dollar is the world's favorite "store value" also known as:

THE WORLD'S RESERVE CURRENCY

What percent of US dollars are held outside the US?

APPROXIMATELY 75%

On a per dollar basis, what percent of transactions in the US are conducted in private money?

APPROXIMATELY 99%

Banks only keep a small fraction of the deposits in the vault. Where is the rest of the money?

LOANED OUT

Rumors that spook people can cause simultaneous bank withdraws known as:

RUNS ON THE BANK

How did the above action impact the US economy?

CAUSED DEPRESSIONS

Multiple currencies are _________ to trade.

OBSTACLES

Describe the characteristics of a "legal note" 

(IOU) - PROMISE TO PAY MONEY - NO DATE AND NO INTEREST

During the Civil War, the US issued IOU's as payment for war supplies known as "___________”

"GREENBACKS"

To increase usage, Congress placed a ________ on transactions using other types of money.

10% TAX

As a result of the action above, suddenly the US had the:

WORLD'S FIRST COMMON CURRENCY

Describe the characteristics of the item above.

A MONEY USED IN MORE THAN ONE NATION/STATE 

What is the economically desirable thing about the above?

IT MAKES TRADE EASIER AND TRADE GROWS

What impact did the adoption on a single curreney have on the US economy?

SOON BECAME #1 IN THE WORLD

Was the above great event planned or lucky?

LUCKY

In 1999, twenty European nations adopted a common currency known as:

THE EURO

Technological change makes the world a _________ place and creates a need for ___________.

SMALLER ; STANDARDIZATION

NAME:

A. Two things that were standard in the US in 1776.

B. The thing that became standardized in the Civil War (1863) -

C. The transportation innovation of the 1870's -

D. Two things that became standardized as the result of the above innovation.

E. The communication innovation of the 1870's -

F. The communication innovation of the 1990's -

G. The transportation method that became much cheaper in the 1990's.

H. Three things that became standard globally in recent years.

I. Three things NOT standardized

J. What is the economic problem with the above items.

a. ENGLISH LANGUAGE & BRITISH LAW

b. US DOLLAR AS THE COMMON CURRENCY

c. STEAM LOCOMOTIVES

d. TIME ZONES & RAIL GAUGE

e. TELEPHONE

f. THE INTERNET

g. AIRPLANES

h. ENGLISH USED FOR AIR TRAFFIC CONTROL, ENGLISH USED ON THE INTERNET, STANDARD SIZE SHIPPING CONTAINERS

i. STEERING WHEELS, ELECTRICITY & WEIGHTS & MEASURES

j. COSTLY AND WASTEFUL

What steam engine characteristic changed the world?

FIRST RELIABLE NON-MUSCLE SOURCE OF POWER

Name four places where steam power was utilized.

STEAMBOATS, TRAINS, FACTORIES AND TRACTORS

Name the history changing tipping point that occurred in the US around 1890.

THE OLD WORLD OF AGRICULTURE GAVE WAY TO THE NEW WORLD OF MANUFACTURING.

Name the history changing tipping point that occurred in the US around 1980.

THE OLD WORLD OF MANUFACTURING GAVE WAY TO THE NEW WORLD OF SERVICES

What percent of the total US economy is in the service sector?

APPROXIMATELY 80%

What social event greatly increased manufacturing output around 1870?

THE INDUSTRIAL REVOLUTION

Why couldn't the money supply grow in the 1880's when output increased?

AMOUNT OF MONEY TIED TO AMOUNT OF GOLD OWNED BY US GOVERNMENT- AND THE SUPPLY OF GOLD WAS NOT GROWING

What happened to prices as output increased and money supply did not?

DEFLATION - FALLING PRICES

How did the change in prices impact farmers?

FALLING CROP PRICES MADE IT HARD TO PAY MORTGAGES

What solution did the farmers support?

"FREE SILVER" - TO CREATE INFLATION AND RAISE GRAIN PRICES

Describe the relationship between gold and silver money?

ONE POUND OF SILVER = ONE OUNCE OF GOLD - "LAND OF OUNCE" - "LAND OF OZ"

What policies did 1896 Democrat McKinley advocate?

WALL STREET BANKERS, GOLD MONEY, NEW YORK

What policies did William Jennings Bryan (WJB) advocate?

MIDWEST FARMERS, SILVER MONEY, CHICAGO

73. What famous speech did WJB give that may have cost him the election?

THE CROSS OF GOLD SPEECH

What arguably blasphemous things did WJB say in the speech?

"YOU SHALL NOT PRESS DOWN ON THIS BROW OF LABOR THIS CROWN OF THORNS; YOU SHALL NOT CRUCIFY MANKIND ON A CROSS OF GOLD"

How did a famous cartoon depict WJB?

STANDING ON THE BIBLE - TRAMPLING ON THE WORD OF GOD.