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Chapter 23 Test
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Terms in this set (39)
goods that, when consumed by one individual, cannot be consumed by another
economic goods that are consumed collectively, such as highways and national defense
the unintended side effect of an action that affects someone not involved in the action
legislation to prevent new monopolies from forming and police those that already exist
Combination of two or more companies into a single firm
a market situation in which the costs of production are minimized by having a single firm produce the product
a special election in which citizens can vote to remove a public official from office
what is the exclusion principal
consumption of private goods and services
what is the nonexclusion principle
consumption of public goods
a sole provider of a good or service
what are the 3 important areas that government regulation is needed?
1. natural monopolies 2. advertising and product labels 3. product safety
GDP after adjustments for inflation
alternating periods of growth and decline that the economy goes through
part of the business cycle in which economic activity slowly increases
period of prosperity in a business cycle in which economic activity is at its highest point
part of the business cycle in which the nation's output (real GDP) declines for at least six months
civilian labor force
all civilians 16 years old or older who are either working or are looking for work
the percentage of people in the civilian labor force who are not working but are looking for jobs
the federal government's use of spending and taxation policies to affect overall business activity
sustained increase in the general level of prices
Consumer Price Index (CPI)
measure of the change in price over time of a specific group of goods and services
What does GDP (Gross Domestic Product) measure?
measure of the economic output
explain the 2 different types of business fluctuations
1. expansions - when GDP goes up
2. Recessions - when GDP goes down
how does fiscal policy affect the economy?
changes in government spending or tax policies.
Why do stock prices change?
dividends and capital gain
what are stock indexes?
statistic measures that track stock prices over time
what are stock exchanges?
a specific location where shares of stock are bought and sold
what is the difference between a bear and bull market
bear = fall
bull = rise
government coupons that can be used to purchase food
Woman, Infants, and Children (WIC) Program
a program that provides help for nutrition and health care to low income woman, infants, and children up to age 5
programs that require welfare recipients to exchange some of their labor in return for benefits
progressive income tax
a tax that takes a larger percentage of higher incomes than lower incomes
Earned Income Tax Credit (EITC)
a program that gives tax credits and even cash payments to qualified workers
how does education affect someones income
the more education the higher the income
how can discrimination impact someones income
it is one of the reasons some people do not receive higher incomes
how do welfare programs help those in need?
they provide needs to citizens that can't provide needs themselves
how do income assistance programs help individuals?
pay cash to people that need it
how do workfare programs help those in need?
they teach people the skills they need to succeed in a job
how do tax policies help those in poverty
tax rate is lower at lower incomes
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