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POLS 206 > Chapter 18 > Flashcards

Chapter 18 Flashcards

1
Q

government regulations that try to keep monopolies from emerging

A

Antitrust policies

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2
Q

a budget in which expenditures equal revenues

A

Balanced budget

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3
Q

the peaks and valleys of the economy between boom and bust

A

Business cycle

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4
Q

a tax levied on the returns that people earn from capital investments, like the profits form the sale of stocks or a home

A

capital gains tax

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5
Q

the ability of unions to determine wages, hours, and working conditions in conjunction with the employer

A

collective bargaining

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6
Q

a plan in which people are taxed not on what they earn but on what they spend

A

consumption tax

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7
Q

shortfalls in the budget due to the government spending more in a year than it takes in

A

deficits

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8
Q

a sharp reduction in a nation’s GDP for more than a year accompanied by high unemployment

A

depression

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9
Q

the elimination of regulations in order to improve economic deficiency

A

deregulation

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10
Q

a period of fast economic growth in GDP, signaling prosperity

A

economic boom

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11
Q

a period of steep decline in GDP, signaling recession

A

economic bust

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12
Q

all the different strategies that government officials employ to solve economic problem

A

economic policy

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13
Q

consumer taxes levied on specific merchandise, such as cigarettes or alchohol

A

excise taxes

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14
Q

independent commission that controls the money supply through a system of twelve federal banks

A

federal reserve system

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15
Q

economic policy in which government regulates the economy through its powers to tax and spend

A

fiscal policy

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16
Q

a tax system in which all people pay the same percentage of their income

A

flat tax

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17
Q

policies that encourage open borders between trading partners by eliminating protectionist policies

A

free trade policies

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18
Q

total market value of all goods and services produced by everyone in a particular country during a given year.

A

gross domestic product

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19
Q

was the general economic decline observed in world markets around the end of the first decade of the 21st century

A

great recession

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20
Q

passed in 1947; limit the power of labor unions, prohibits fed workers from striking and allows firing of workers who do strike; Reagan fired 12000 striking fed air traffic controllers

A

taft-hartley act

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21
Q

passed in 1933 by congress; banking reforms: FDIC - insured money deposited in banks; parts repealed in 1999 for subprime mortgage trade - caused 2008 recession

A

glass-steagall act

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22
Q

increased fed oversight and control over derivatives trading; volcker rule prevents banks from speculating with their won money; didn’t bring dramatic change in ways banks do business

A

dodd-frank act

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23
Q

american’s tax for reform: promotes a flat tax, conservative

A

Grover Norquist

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24
Q

allowed for unionization of employees; established national labor relations board to oversee labor laws and investigate complaints; allowed unions to engage in collective bargaining

A

Wagner Act

25
Q

fed chair of the federal reserve system; helped gov run a balanced budget to surplus in 1998

A

allan greenspan (ayn rand)

26
Q

Janet Yellen

A

next fed chair?

27
Q

a contract that derives its value from an underlying entity (asset, index, interest rate)

A

derivatives

28
Q

financial swap agreement that the seller of the CDS will compensate the buyer in the event of a loan default or other credit event; invented by masters and jp morgan

A

credit default swaps (cds)

29
Q

federal national mortgage assoc./federal home loan mortgage corporation

A

Fannie mae and Freddie mac

30
Q

an increase in the price of goods

A

inflation

31
Q

the cost of borrowing money calculated as a percentage of the money borrowed

A

interest rates

32
Q

an economic theory that government could stimulate a lagging economy by putting more money into it or cool off an inflationary economy by taking money out

A

keynesianism

33
Q

basic principles that regulate the economic market and influence the price of a good

A

laws of supply and demand

34
Q

economic policy in which government regulates the economy by manipulating interest rates to control the money supply

A

monetary policy

35
Q

a situation in which a single producer dominates a market and there is no competition

A

monopoly

36
Q

the total of the nation’s unpaid deficits, or simply the sum total of what the national government owes

A

national debt

37
Q

no tax on trade between north american countries

A

NAFTA

38
Q

taxes whose rates increase with income

A

Progressive taxes

39
Q

the imposition of trade barriers, especially tariffs, to make trading conditions favorable to domestic procedures

A

Protectionism

40
Q

a decline in GDP for two consecutive quarters

A

Recession

41
Q

taxes that require poor to pay more of their income than the wealthy

A

Regressive taxes

42
Q

an ideal market that corrects itself when it moves in an inflationary or recessionary direction

A

self-regulating market

43
Q

reagan’s economic plan, tax cuts generate more gov revenues because the rich would be able to buy more stuff.

A

supply side economics

44
Q

the extra funds available because government revenues are greater than its expenditures

A

surpluses

45
Q

the difference between the value of the goods a country imports and what it exports

A

trade deficit

46
Q

a consumption tax levied at each stage of production, based on the value added to the product at that stage

A

value-added tax

47
Q

economic slump in industrialized areas of the world from 1929-39

A

Great depression

48
Q

no govt influence needed, free enterprise system will correct economy

A

Laissez-faire economics

49
Q

strongest advocates of govt. action in 1930s; british economist; gov should step in using fiscal policy

A

john maynard keynes

50
Q

regulated financial institutions to explain their information sharing practices to their customers and safeguard sensitive data

A

gramm-leach-Bliley Act

51
Q

bush admin used to bailout financial institutions deemed “too big to fail”; $30 billion

A

troubled assets relief program (tarp)

52
Q

gave the pres the responsibility for preparing and delivering to congress a national budget; created Office of management and budget (OMB); approved by congress

A

Budget and accounting act of 1921

53
Q

levied on employers and employees to fund SS program;collected in form of payroll tax or self-employment tax

A

social security tax

54
Q

added $900 billion of spending on tax relief for individuals and businesses; Keynesian; +3.3 million jobs by 2011

A

American recovery and reinvestment act of 2009 (stimulus bill)

55
Q

current fed chair of the federal reserve system

A

Paul Bernanke

56
Q

a former Goldman Sachs bond trader known for his colorful nickname “Fabulous Fab,” was found liable for fraud Thursday for his role in a failed mortgage deal that cost investors $1 billion in a debacle that foreshadowed the financial crisis

A

Fabrice Toure

57
Q

collection of nonbank financial intermediaries that provide services similar to traditional commercial banks

A

Shadow banking system

58
Q

a structured financial product that pools together cash flow generating assets and repackages this asset pool into discrete tranches that can be sold to investors; high risk

A

Collaterized debt obligations (CDOs)

59
Q

investment theory, it is impossible to beat the market because stock market efficiency causes existing share prices to always incorporate and reflect all relevant information

A

Efficient markets hypothesis

POLS 206 (18 decks)

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