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41 terms

Social Studies-Last One!

STUDY
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supply
quantity of an item
demand
wanting or needing of an item
price
function of supply and demand
law of scarcity
if an item is scarce, it has a larger price
everyone has a right to ...
profit, loss, possibility to succeed or fail
outsourcing
when jobs go overseas for cheaper labor rates and less regulations
causes of inflation
cost(push), demand(pull), monetary inflation
money supply
the amount of money in circulation throughout the economy at any given time
money
medium of exchange
specie
precious metals, usually gold and silver for currency
convertibility
the ability to change specie into paper notes and back again
note
used as money, made of paper derivative
intrinsic value
percentage of the total money supply that a good or service is worth
national debt
what the country owes it bond holders
bond
an IOU for money over a specific length of time with the promise to pay interest and principal when the time expires
Progressive Graduated Income Tax(PGIT)
the more you make, the more the government takes
flat tax
everyone pays the same taxation rate
how to get rid of a deficit
cut spending, raise revenue, borrow-bond
ways out of a debt trap
pay in full, pay a % of the debt, repudiate=don't pay debt, monetize=change money=hyperinflation
hyperinflation
13% inflation or more
business cycle
a cycle that lasts 7-10 years. It cycles through recovery, prosperity, recession, and depression and then repeats
recession
6 months of negative economic growth
GDP
gross domestic product
3 types of business ownership models
sole proprietorship, partnership, corporation
sole proprietorship
one person owns the business
partnership
two or more persons own the business with equal or non-equal ownership
corporation
owned by stockholders and administered by a board of directors
pros of sole proprietorship
easy to raise capital, ease of liquidation of assets; dealing with no other people other than clients
pros of partnership
easy to raise capital with partners' permission; can multiply the ability to raise capital by the number of partners in the partnership
pros of corporation
cumbersome to raise capital, but the amount can be huge compared to sole proprietorship or partnership; treated as a person under the law; can be advantageous due to taxes; limited liability
push inflation (cost)
when an ingredient or item during the manufacturing process goes up in cost
pull inflation (demand)
when demand outstrips supply tremendously
cons of a sole proprietorship
cannot raise adequate capital; total liability
cons of a partnership
dealing with partners; total liability
cons of a corporation
owners are the shareholders; treated as person under the law
16th Amendment
allows government to tax
total liability
if your business goes out of business, your items/property are at risk
Chief Justice Marshall said..
"the power to tax is the power to destroy"
monetary inflation
increase in money supply which cause price inflation. ms1=100 2%=2; ms2=200 2%=4; ms3=50 2%=1
a surplus causes
rainy day fund; tax cut
rainy day fund
used to stop a deficit