Economics test 1

The study of how incentives affect society and government

economics

all that you forego by making a choice, including but not limited to the money cost.

opportunity cost

prices are determined by the value of one additional unit of something

marginal value

policies have consequences other than those intended; sometimes they may make a problem worse

cobra effect

daycare,rent, health care

biggest expenses

You have to have under a certain income to qualify for a benefit.

means-tested

Work credit that may give you money back at tax time or lower the federal taxes you owe. The main requirements is that you must earn money from job. The credit can eliminate any federal tax you owe at tax time.”

EITC “the earned income tax credit

“a welfare program that gives cash aid and services to eligible needy California families for a limited number of months.”

TANF

formerly known as the Food Stamp Program, is a federal program that provides food-purchasing assistance for low- and no-income people.

SNAP

“covers most medically necessary care. This includes doctor and dentist appointments, prescription drugs, vision care, family planning, mental health care, and drug or alcohol treatment. Medi-Cal also covers transportation to these services.”

Medical (california medicaid)

covers up to 70% of rent for people less than 50% of county median income

section 8 housing vouchers

free day care for people making less than 125% of the poverty line; subsidies for others, averaging $500

Day Care policies

your credit card spending

principle

 charges you a percent of the principle every month

How to minimize credit card expenses

interest

a company that brings together money from many people and invests it in stocks, bonds or other assets. The combined holdings of stocks, bonds or other assets the fund owns are known as its portfolio.”

mutual funds

type of mutual fund or exchange-traded fund (ETF) with a portfolio constructed to match or track the components of a financial market index, such as the Standard & Poor’s 500 Index (S&P 500).

Index funds

 when you earn interest on both the money you've saved and the interest you earn.

compound interest

a debt the company or country owes to you rather than an investment, so the interest and value of the bond is not tied to the stock market value of the company. The price of bonds also goes in the opposite direction of interest rates.”

bonds