GOVT Ch. 17
In 2016 the US national debt was roughly equivalent to ____ per person
$59k
The total income that consumers, businesses, and government wish to spend for goods and services is referred to as
aggregate demand
The House Armed Services Committee and Senate Banking, Housing, and Urban Affairs Committee are ____ committees that review portions of the budget that pertain to their area of responsibility
authorization
Market economies are loosely called
capitalist economies
Monetarists argue that government can control the economy's performance simply by
controlling the money supply
The role of appropriations committees is to
decide which programs will be funded
A government spending in excess of tax revenues to combat an economic slump is known as
deficit spending
Non-entitlement spending that is authorized by annual appropriations is referred to as ____ spending
discretionary
The Department of Education successfully lobbies to have added to the budget a new federally-funded program that would provide for technology in classrooms. Spending on this program would be best described as ____ spending
discretionary
Social Security and veterans' pensions, which provide benefits to which individuals have a legal right and which cannot be reduced without changing the law, are also referred to as
entitlements
For the first time in Federal Reserve history, members of Congress proposed auditing Fed decisions following the Fed's actions during the
financial crisis of 2008
If government cuts taxes to encourage people to spend more money in order to stimulate economic growth, it is engaging in
fiscal policy
The total federal tax burden on US citizens ___ than the 1950s
has actually decreased since
Developing budgets by using last year's budget as the base and adding an amount to cover the increased costs of doing business (inflation) and any new programs is called
incremental budgeting
Which of these terms is an economic condition characterized by price increases linked to a decrease in the value of the currency?
inflation
Traditionally, the Federal Reserve has tended to be more concerned about ____ than
inflation; unemployment
Within the federal budget, expenditures that are required based on previous commitments are called ____ spending
mandatory
When asked in a recent national poll whether federal spending should be "increased, decreased or kept about the same" for eighteen different purposes, respondents said that every category of spending should be maintained or increased EXCEPT
military defense, unemployment aid, and aid to the world's needy
When discussing the federal budget, the phrase "uncontrollable spending" refers to the fact that
much of the budget is already committed by past contracts and agreements
From WW2 until the collapse of the Soviet Union, the national budget allowed for the most spending in the area of
national defense
The text suggests that no one in Congress is responsible for the budget as a whole because
one group in each house plans for revenues, and many other groups plan for spending
A tax allocated based on a person's ability to pay, rathe than, for example, requiring everyone to pay an equal percentage of their income, is known as a ___ tax
progressive
A tax where the rich pay proportionately higher taxes as a share of their income than the poor is also known as a
progressive tax
One important governmental justification for progressive taxation is
promoting equality
Because everyone pays the same rate of sales tax on purchases, and less wealthy people spend most of their income buying things, as opposed to saving and investing, the sales tax has a ____ impact
regressive
The simultaneous occurrence of slow growth, unemployment, and inflation is referred to as
stagflation
The idea of tax cuts for the rich that will then "trickle down" to working people in the form of additional jobs and income, is consistent with
supply-side economics
Which committees are responsible for raising the revenue with which to run the government
tax committees
Supporters of supply-side economics are likely to favor
tax cuts to stimulate investment
The essence of supply-side economics is that
taxes should be cut to stimulate investment, and govern regulation of business should be decreased
Monetary policies are largely determined by
the Federal Reserve Board
Adam Smith's "invisible hand" refers to
the economic force that converts individual pursuit of personal profit into societal good
The Budget and Accounting Act of 1921 placed the responsibility for preparing the federal budget in the hands of
the president
According to the text, _____ have historically been most favored by America's tax policies
the richest citizens
The _____ Amendment empowered the national government to collect taxes on income
16th
In February 2016, the total national debt was about ___ trillion dollars
19
The interest on the accumulated national debt accounts for over ___ of all national government spending
7%
A good method of evaluation a country's amount of national debt, according to the authors, is
Dividing the debt as a percentage of GDP
The system of banks that act as the bank of the US is called the
Federal Reserve
The value of the goods and services actually produced is called the nation's
GDP
One famous monetarist theorist is Nobel Laureate
Milton Friedman
The fiscal year refers to the interval the US government uses for accounting purposes and runs from
October 1st- September 30th
The ____ supervises the development of the president's budget
Office of Management and Budget (OMB)
The business cycle is
Periods of expansion and inflation alternating with periods of contraction and unemployment
According the efficient market hypothesis, financial markets ____ all relevant information about securities into their prices
Quickly absorb
President ____ embraced supply-side economics
Reagan
For the fiscal year 2017, the federal government's single largest budgeted spending item is for
Social Security
An example of a regressive tax in America is the
Social Security tax
Today China says that it has a _____ market economy because it depends on the private sector for economic growth but also direct and supports state-owned enterprises
Socialist
A country in which the government is described as laissez-faire is one in which
There's no government control