Government and the Economy Flashcards
Does the U.S. government play a role in our economy
yes
what is involved in circular flow?
resources, goods and services flowing freely among households, businesses and markets (money flows in other direction)
where does “Purchases of goods and services” go?
1
where does “taxes” go?
2 & 7
where does “Government purchases” go?
3
where does “demand” go?
4
where does “Incomes” go?
5
where does “Social Transfers” go?
6
where does “wages, dividends, intersect, profits and rent” go?
8
what role does the government play in circular flow?
taxing consumers and businesses to provide public goods and services
what is money?
anything referred to as payment
makes it easier to borrow, save, invest and purchase good and services
what are 3 types of money?
coins
federal reserve notes (surrency of dollar bills)
deposits in bank accounts
what role do banks and credil unions play?
they encourage saving or investing by paying interest
what are public goods and services?
things that are provided to individuals and buissnesses by the government
Ex: highways, national defense, education
how does the government pay for goods and services?
(there are 3)
tax revenue,
borrowed funds,
fees paid
paid when someone uses services only the government provides (Ex: national park, buying stamps)
fees
are issued when a law has been broken
fines
what does income tax revenue pay for?
services like national defense or homeland security
what are state and local taxes?
state- income taxes, sales taxes
local- sales taxes, property taxes
what are some rights the government protects?
consumer right
labor
environment
property rights
competition
What is the CPSC?
consumer propuction safty commison, they protect consumer rights
What is the FDA?
food and drug administration, protect consumer rights and say that consumers have the right to take legal action if rights are violated
What agencies regulate labor?
Occupatinal Safety and Health Administration (OSHA)
Equal Opportunity Employment Commission (EEOC)
what is EPA?
Environmental Protection Agency
Why is competition in the marketplace important?
it makes better quality goods and lowers the price
what is a monopoly?
one business controls the distribution of one good or service
what is free enterprise?
businesses compete within the marketplace
how does the government encourage business startup?
offers low interest loans or grants
what is global trade?
worldwide markets where buying and selling of goods and services happens
why do we participate in global trade?
it allows more consumer choice
why do we engage in international trade?
increase wealth,
lower cost or opportunity cost of goods and services
allows selling goods and services to other countries
creates jobs
how does virginia participate in the global economy?
specilalize in production of certain goods and services
how has advances in technology impacted the global economy?
by encouraging the global flow of information via the internet
lower cost of production
federal agencies that regulate the economy are a part of which branch?
executive
What is the FCC?
federal communications commission, they are responsible for regulating interstate and international communications
What is the SEC?
Security Exchange Commission, they manage protection of investors
What is the FTC?
Federal Trade commission, they oversee how buisinesses advertise, protect against false advertisments
what is the federal reserve system and what do they do?
serves as central bank
regulates banks
influences money supply and intrest raites in economy
