vocab unit 4

Question 1

A tax in which the percentage of income you pay increases as your income increases.

Answer 1

progressive tax

Question 2

A tax in which the percentage of income you pay decreases as your income increases.

Answer 2

regressive tax

Question 3

A tax in which everyone pays the same percentage of income. Also called a Proportional Tax.

Answer 3

flat tax

Question 4

The medical assistance program which helps many Americans (particularly those with low incomes) get the medical treatments they need.

Answer 4

medicaid

Question 5

A bill that proposes the spending of money

Answer 5

appropriations bill

Question 6

The medical assistance program which helps many Americans (particularly the elderly and disabled) get the medical treatments they need.

Answer 6

medicare

Question 7

When the government spends more money than it takes in. Spending is greater than revenue.

Answer 7

budget deficit

Question 8

When the government spends less money than it takes in. Spending is less than revenue.

Answer 8

budget surplus

Question 9

A tax paid by employers that partly funds Social Security
and Medicare.

Answer 9

FICA

Question 10

The portion of the budget that the government is required by law to spend.

Answer 10

mandatory spending

Question 11

The portion of the budget that the government can choose whether or not to spend.

Answer 11

discretionary spending

Question 12

The total of all the money owed by a country for all years.

Answer 12

national debt

Question 13

government programs that provide a guaranteed benefit to anyone who meets present requirements

Answer 13

entitlements

Question 14

The way in which the actions of the government influences and affects the economy.

Answer 14

fiscal policy

Question 15

The removal of government restrictions.

Answer 15

deregulation

Question 16

The total of all goods and services businesses are willing and able to supply at all price levels.

Answer 16

aggregate supply

Question 17

The total of all goods and services consumers are willing and able to buy at all price levels.

Answer 17

aggregate demand

Question 18

Being able to produce a good or service more efficiently at a lower total cost.

Answer 18

absolute advantage

Question 19

Being able to produce a good or service at a lower opportunity cost.

Answer 19

comparative advantage

Question 20

Anything that interferes with the importing and exporting of goods and services.

Answer 20

trade barrier

Question 21

The idea that it is more important to protect domestic jobs than to encourage the removal of
trade barriers.

Answer 21

protectionists

Question 22

The idea that it is more important to encourage the removal of trade barriers than to protect domestic jobs.

Answer 22

free traders

Question 23

A trade agreement between the United States, Mexico, and Canada to remove trade barriers between them.

Answer 23

USMCA

Question 24

When the exchange rate between two countries’ currencies is held constant and not allowed to fluctuate.

Answer 24

fixed exchange-rates

Question 25

When the exchange rate between two countries’ currencies is allowed to fluctuate with the foreign exchange market.

Answer 25

flexible exchange rates

Question 26

An increase in the value of a country’s currency.

Answer 26

appreciation

Question 27

A decrease in the value of a country’s currency.

Answer 27

depreciation

Question 28

A comparison of the exports and imports of a country.

Answer 28

balance of trade

Question 29

When a country’s imports are greater than its exports.

Answer 29

trade deficit

Question 30

When a country’s exports are greater than its imports.

Answer 30

trade surplus

Question 31

An organization dedicated to encouraging the reduction and removal of
trade barriers around the world.

Answer 31

world trade organization

Question 32

A formal organization of businesses in a market that collude together to increase their profits.

Answer 32

cartel