econ III

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truet/f if both labor and management agreee to abide by the ruling of a third party to settle their dispute, the process is called arbitration.

true

If an agreement cannot be reached ning, workers use the boycott-refusing to work until their demands are met

false

During arbitration, a third party makes a nonbinding compromise to resolve a dispute between labor and management

False

Skilled laborers are workers who are able to operate complex equipment and who can work with little supervision.

True

The traditional theory of wage determination states that wages are set according to the laws of supply and demand.

True

Supply and demand are used to predict the incidence of a tax.

True

The 3 criteria for effective taxes are equity, complexity, and efficiency.

False

The 2 principles of taxation are the benfit principle and the ability-to-pay principle.

True

he marginal tax rate is the rate that applies to the next dollar of taxable income.

True

A regressive tax imposes a lower perrate of taxation on low incomes than on high incomes.

false

Distribution of income explains the way in which income is allocated to individuals, familes, or other designated groups.

True

One of the major concerns about the national debt is that more than 50% of it is owed to investors outside of the US

False

consequences of the national debt include the redistributition of income and diminishing incentives to work, save, and invest.

True

Most Americans favored unions in the 1930's but shifted to favoring management after WWII

True

The closed shop was made illegal by the Taft-Hartley Act of 1947.

True

The agency shop requires that an employee join the union shortly after being hired.

False

Government spending can directly affect both the allocation of resources and the distribution of income.

True

The fastest growing category of fderal exenditures since 1980 has been defense.

False

States spend the largest portion of their revenues on intergovenmental expenditures and public welfare.

True

Fiat money has no inherent worthl.

True

The Fair Labor Standards Act..

D. established a federal minimum wage

The national Labor RElations Act...

B. established the right of unions to collective bargaining

When labor and management ask a third party to collect information about a dispute and present non-binding recommendations, they are using...

A. Fact-finding

Workers with knowledge-based education and managerial skill are..

D. Professional labor

The incidence of a tax can more effectively be shifted from the supplier to the consumer if...

A. the demand curve is inelastic

The flat tax

D. Simplifies the tax process

The 'incidence of a tax'..

B. refers to those who bear the final burden of taxation

Ann earns $10,000 annually and pays a tax of $1,000. Jerome earns $60,000 during the same period and pays taxes of $20,000. The tax they both paid was a ...

B. progressive tax

FICA includes taxes to pay for...

A. Social Security and medicare

The flat tax..

C. Departs from the ability-to-pay principle of taxation.

In order for money to have value, it must have all of the following characteristics EXCEPT...

B. plentiful availability

The first fedral legislation to exempt unions from the antitrust laws was the

C. Sherman Antitrust Act

The invisible barrier that hinders women and minorities from advancement up the corporate ladder

B. is known as the glass ceiling

An example of mandatory spending is financing for

A. interest payments on the federal debt

The largest category of spending for most local governments is

A. elementary and secondary education

The sequence for the approval of the federal budget is...

B. president to congress back to president

The largest category of state spending is

C. intergovenmental expenditures

Money loses its value when it...

D. becomes too plentiful

The FDIC was established to

A. protect the savings of the American people

A special tax on gasoline is probably a ____ tax.

Excise

A _____ duty is a charge levied ongoods brought in from other countries

customs

The person who assigns value to property for tax purposes is the_________.

Tax Assessor

Businesses may receive an ____ for investing in new plants and equipment.

investment tax credit

The _____ requires an employer to automatically deductin income taxes from an employee's wages and send it directly to the government

payroll withholding

_____ is the tax paid on the profit people earn from the sale of an asset they've held for a year or more.

capital gains tax

When a person dies, the govenment may levy an _____ on the transfer of the deceased's property to someone else

estate tax

Many people believe a ____ tax is most fair because everyone will pay the same percentage of taxes

propertional

A local government may impose a ____ on the real estate and automobiles belonging to its citizens

property tax

Current dollars

dollars that are not adjusted for inflation

strike

refusal to work until demands are met

injunction

court order not to act

mediation

use of a neutral third person or persons to hellp settle a dispute

equilibrium wage rate

leaves neither a surplus nor a shortage in the labor market

arbitration

labor and managment agree to accept a 3rd party's decision as binding

boycott

mass refusal to buy products from targeted companies

right-to-work law

state law making it illegal to force workers to join a union

agency shop

employment situation where workers do not have to join a union but must pay union dues

minimum wage

lowest wage that can be paid by law to most workers

sin tax

relatively high tax on socially undersirable products, such as tobacco

property tax

tax on tangible and intangible possessions, such as real estate, buildings, furniture, stocks, bonds, and bank accounts

individual income tax

tax on people's earnings

indexing

upward revision of the tax brackets to compensate for the effects of inflation

progressive tax

tax that imposes a higher percentage rate of taxation on people with higher incomes than on people with lower incomes

capital gains

profits from the sale of an asset held for 12 months

excise tax

tax on the manufacture and sale of selected items

proportional tax

tax in which everyone pays the same percentage regardless of income

corporate income tax

tax paid by corporations on their income

tax assessor

person who assigns value to property for tax purposes

regressive tax

tax that imposes a higher percentage of taxation on lower incomes than on higher incomes

flat tax

proportional tax on individual income after an income threshold has been reached

estate tax

tax levied on property left to an heir when a person dies

fiscal year

12 month financial-planning period that may or may not correspond with the calendar year

balanced budget

budget in which spending equals revenues

transfer payment

payment for which the govenment receives neither goods nor services

mandatory spending

spending authorized by law that continues wihtout the need for annual approvals by Congress

entitlement

social programs that provide services or income to all individuals who meet eligility requirements

deficit spending

when the govenment must borrow money to pay for government programs

crowding-out effect

higher interst rates caused by heavy government borrowing

appropriations bill

act of Congress tha tauthorizes fedral agencies to spend money

discretionary spending

fedral programs that must receive annual authorization by Congress

line-item veto

presidential power to cancel specific budget items without rejecting the entire budget

barter economy

economy based on trade rather than money

medium of exchange

something accepted as payment for goods and services

Federal Reserve Note

paper currency issued by the Federal Reserve System

monetary standard

mechanism by which money is kept portable, durable, divisible, and limited in suppply

legal tender

fiat money that must be accepted in payment for debt

gold standard

paper currency backed by gold

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