Consumer price index is used to measure what?
market basket, a group of household everyday, check price every year
What is GDP?
gross domestic product, final value of all goods and services produced in a country in a given year
When unemployment decreases and wages get higher, we are in what phase of the business cycle?
expansion
When unemployment increases, people shop less, and the number of jobs decline we are in what phase of the business cycle?
contraction
What part of the business cycle is the "boom" ?
peak
When the economy is in the trough phase for 2 quarters this is known as?
recession
When we are in the trough phase for a very long time, that is known as?
depression
What is the free trade agreement between the US, Canada, and Mexico?
NAFTA
In which economy does government have control over the factors of production?
command
What economy lets custom and tradition make the decisions about the factors of production?
traditional
Which economy has the government and business make decisions about the factors of production?
mixed
How did Karl Marx feel wealth should be divided?
equally
Which economy is Karl Marx associated with?
command
Which economy is Adam Smith associated with?
market
Which economy is John Keynes associated with?
mixed
Which philosopher discussed the invisible hand and laissez-faire?
adam smith
Which tax is placed on alcohol, cigarettes, and gasoline?
excise (luxury or sin) tax
What do we call the tax on property?
proportional
Sales tax is an example of what type of tax?
regressive
Which type of economy has government control over big industries and a large tax to be paid by its citizens?
socialist
Who is in charge of Monetary Policy?
FED
Who is in charge of Fiscal Policy?
congress
What can Congress do to speed up or slow down the economy
raise/lower taxes, increase/decrease gov't spending
What can the FED do to speed up or slow down the economy
raise/lower interest rates, increase/decrease money printed
Who appoints the chairman of the FED?
president of the usa
Define absolute advantage
can produce more goods than another country
Define comparative advantage
can produce goods cheaper than another
Who collects taxes?
congress
Why would a company outsource?
higher profit, pay workers less
What is the World Trade Organization?
oversees trade between nation
What is the the International Monetary Fund?
monitors exchange rates
What is a tariff?
tax on imported goods
Define imports
goods coming into the country
Define exports
goods going out of the country
What is the difference between favorable or unfavorable balance of trade?
I sell more items (exports) than I buy (imports)
Define inflation
caused by too much money in society
how does inflation affect purchasing power?
you can buy less stuff with your money than before
What type of tax hurts the poor the most?
regressive
What type of tax takes more of a percentage of your income as your income increases?
progressive
What is the Research Triangle Park?
research facility established in Raleigh, Durham, Chapel Hill to create jobs and development in area
Define deficit
spend more than you make
Define surplus
spend less than you took in
Define balanced budget
revenue (income) matches expenditures (what you spent)
What is socioeconomic status?
how developed they are