US GOV TEST - CHAPTER 16

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fiscal policy

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80 Terms

1

fiscal policy

a government's various means it uses to raise and spend money and thereby influence the nation's economy

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2

progressive tax

what kind of tax increases in accordance to a persons income? (the higher the income, the higher the tax rate)

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3

regressive tax

what kind of tax is based on a fixed rate without regard to a taxpayer's income?

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4

interest

what is the price one pays to borrow money called?

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5

deficit

what is it called when the government spends more than it earns?

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6

surplus

what is it called when a government earns more than it spends?

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7

Keynes

what english economist proposed the idea that the government should borrow and spend more to improve the economy? (last name only)

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8

demand

when economists say more spending and borrowing is required to improve the economy, this is called ? side economics

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9

supply

when economists say lower taxes instead of greater spending is needed to improve the economy, this is called ? side economics

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10

dont interpret

what is the first step to interpreting something?

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11

what do i see

what is the second step to interpreting something?

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12

whats happening

what is the third step to interpreting something?

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13

look at the words and define them

what is the fourth step to interpreting something?

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14

what do the words have to do with what you see and whats going on

what is the fifth step to interpreting something?

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15

interpret it

what is the sixth step to interpreting something?

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16

purchasing power parity

what does PPP stand for?

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17

please as many people as you can, displease no one

what is the first rule of politics

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18

power

what is the one word definition of politics?

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19

old age, survivor, disability insurance

what does OASDI stand for?

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20

entitlements

benefits that federal law says MUST be payed to all those who meet eligibility requirements

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21

gross domestic product

what does GDP stand for?

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22

inflation

what is it called when prices increase, and the value of money goes down?

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23

deflation

what is it called when prices decrease, and the value of money increases?

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24

recession

when there is an absence of growth and the economy shrinks, it is called a:

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25

monetary policy

what policy involves the money supply and the availability of credit in the economy?

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26

open market operations

the process that involves the buying or selling of government securities (bonds) from the nation's banks

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27

discount

the ? rate is the rate of interest a bank must pay when it borrows money from a federal reserve bank

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28

50k

what is the MEDIAN yearly salary in the U.S.

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29

1.90

what is the WORLD'S poverty line in $ a day?

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30

90k

what is the AVERAGE salary in the US?

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31

economics

a study simply defined as: where you learn how to maximise scarce resources

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32

10k

what is the MEDIAN salary in the WORLD (PPP)

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33

OASDI

what is the LARGEST expense of the federal government?

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34

23

what percent does OASDI take from the FEDERAL budget? (think: how many cents of the dollar?)

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35
  1. pay back debt/borrow more

2)print money/open market operations to shrink money supply

3)raise tax/cut tax

4)raise spending/lower spending

5)raise intrest rate/lower intrest rate

LIST all 5 OPTIONS the government has to tackle the debt

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36

C+G+I+(X-M)

fill in the GDP equation: GDP = ...

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37

abel, baker, and charlie

who are the three original characters from the fish book?

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38

capital

what is the term for something created not for its own sake, but to make something else/earn money (ex: the net from the fish book)

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39

FED

nickname for the US federal reserve bank

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40

24 trillion

what is the current estimated US GDP?

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41

30 trillion

what is the current estimated US national debt?

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42

335 million

what is the us population?

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43

7.9 billion

current world population

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44

federal individual income tax

from what tax does the federal government earn MOST of its revenue?

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45

48

what percent does the US government earn from the federal individual income tax? (think: how many cents of the dollar?)

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46

reserve requirement

what is the name for the amout of money that the federal reserve board determines banks must keep "in reserve"

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47

full employment price stability economic growth

what are the three main goals the Federal Government seeks to achieve in the economic realm? (according to chapter 16.4)

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48

discretionary spending

a term also known as controllable spending; describes spending on specific budget items that congress and the president can control

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49

mandatory spending

a term also known as uncontrollable spending; describes budget items that congress cannot control the amount spent because of laws and entitlements

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50

public debt

term for the total outstanding indebtedness of the federal government

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51

payroll tax

a tax applied to a percent of a persons salary, matched by their employer

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52

excise tax

tax laid on the manufacture, sale, or consumption of goods and/or the preformance of services

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53

estate tax

levy imposed on the assets of someone who dies (ex: ryan inheriting mr fredericks car AFTER he dies)

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54

gift tax

tax imposed on a gift from one living person to another (ex: mr frederiks giving ryan his car BEFORE he dies)

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55

customs duty

taxes on goods IMPORTED to the united states from abroad

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56

net

what capital does able create to catch more fish?

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57

underconsumption

when one chooses to consume less in order to potentially consume more in the future (think: able did not eat fish for a day to make his net)

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58

skim question read recite review

what does SQ3R stand for? list each step

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59

principal

the original amount in an investment, or the original amount of money before intrest is called what?

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60

fiat

? currency is money that has no intrinsic value, and cannot be redeemed for precious metals (on its own it has no value; ex: paper money)

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61

12

how many federal reserve (district) banks are there?

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62

minting

? is the process of making coins

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63

medicare

health care intended for the ELDERLY

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64

medicaid

health care for the POOR

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65

70

what percent of the federal budget (think: the dollar) is spent on entitlements?

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66

entitlements intrest payments on national debt big ticket items

LIST the three examples of uncontrollable/mandatory spending in the US budget?

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67

expenditures

term for the money going OUT of the federal government

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68

revenue

term for the money EARNED by the federal government

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69

federal insurance contribution act

what does FICA stand for?

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70

federal unemployment tax act

what does FUTA stand for?

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71

35

combined, what percent does FUTA and FICA add to the us revenue? (think: how many cents of the dollar?)

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72

consumption

in the GDP equation, 70% (variable C), stands for what? (this explains what 70% of the GDP is used on)

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73

government

in the GDP equation, 20% (variable G) stands for what? (this explains what 20% of the GDP is used on)

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74

28

what percent of the us budget is spent on medicare and medicaid COMBINED (think: how many cents of the dollar?)

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75

credit

term for capital that is loaned out/borrowed

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76

investment

term for risking savings to possibly produce more later

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77

savings

term for an unused fund of money; underconsumption that is not used

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78

the power to make things the way you want them to be

what is the LONG definiton of politics

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79

brainwashing

getting someone to think something, without letting them think about it

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80

THINK

what was the focus from the first day of class?

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