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Civics 2nd Semester Exam Study Guide 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. What kind of tax is not a source of revenue for state and local governments? Poll taxes Government revenues in the form of fines are based on… Payments made as penalties The federal income tax system is based on a progressive tax. A progressive tax is based on the principle that… The more people earn the more they pay Sin taxes, which are excise taxes on such goods as alcohol and tobacco, are often imposed for the purpose of… Decreasing quantity demanded U.S. citizens financially support government programs mainly through… Income taxes The local governments in Louisiana receive the majority of their revenue from… Property Taxes If the federal government continues to increase spending while tax revenues remain stable, the federal budget deficit will most likely… When federal tax revenue increases, the federal budget deficit will always… Decrease if spending does not increase Which result will most likely occur when a national government vastly increases its spending while revenues are declining? The country will see a growing budget deficit Social security benefits are financed with revenue from… Employment taxes Government-run unemployment benefits systems are geared primarily toward assisting… Able-bodied people who are actively seeking jobs Which economic policy is not the responsibility of the U.S. government? Protecting monopolistic practices During periods of inflation, many economists argue that the government should try stabilizing the economy by… Lowering tax rates When the economy contracts, unemployment rises because… Demand declines Which activity is related to fiscal policy but not to monetary policy? Spending revenue Fiscal policy is more concerned than monetary policy with the effects of… Tax rates Which statement about fiscal and monetary policy is false? Fiscal policy focuses on manipulating the federal budget to stabilize prices and employment, while monetary policy focuses on manipulating currency exchange rates Which kind of action is an execution of fiscal policy, as opposed to monetary policy? Changing income tax rates Expansionary monetary policy and expansionary fiscal policy are both tools to stimulate the economy, Which pairing matches an economic stimulus to the correct type of policy? Buying bonds on the open market – Monetary Policy A _____ is a 12-month period that may or may not match the calendar year Fiscal Year When passed by congress, what becomes a law that authorizes spending for a particular activity? Appropriations Bill _____ are deducted from a worker’s paycheck to fund Social Security and Medicare. Payroll Taxes Which program pays some health care costs of elderly people? Medicare _____ tax is levied by the states on the purchase of most products. Sales What occurs when the government spends less than it collects in revenue? A surplus _____ are contracts to repay borrowed money with interest at a specific time in the future. Bonds What occurs when spending equals revenue? Balanced Budget Which term describes the blueprint of how the government will raise and spend money? Budget _____ spending does not need approval. Mandatory What government expenditures must be authorized each year? Discretionary Spending Which government program provides money to people who are retired or disabled? Social Security What is the tax that people pay on the land and houses they own? Property Tax 33. _____ is money that has been borrowed but not yet repaid. Debt 34. What role does the U.S. Federal Reserve play in the national army? It regulates the money supply and key interest rates 35. The Federal Reserve System affects the rest of the U.S. banking system by… Lending financial resources to banks 36. When inflation occurs, the Federal Reserve typically responds by… Reducing the money supply 37. The Federal Reserve System is responsible for… Supervising member banks 38. The Federal Reserve System can increase the country’s money supply by… Buying bonds on the open market 39. Which action is not one of the ways the Federal Reserve System helps support banks? Regulating bankers 40. Janet wants to buy a new computer, but she needs to purchase a new furnace before winter arrives. What is the most likely reason Janet cannot purchase both the computer and the furnace? Resources are scarce 41. Mark is going to purchase a new car. He must choose between a two-door sports car, and a less expensive four-door family car. What is the opportunity cost to Mark of choosing the family car? The fun of driving a sports car 42. Which consequence is a direct result of economic scarcity? Consumers make trade-offs 43. In economics, scarcity exists because people… Choose which preferences to satisfy with limited resources 44. Ben decided to buy a less expensive pair of jeans so that he could buy a more expensive pair of basketball shoes. This economic decision is an example of… A trade-off 45. Which economic term refers to factors that motivate consumers to purchase particular goods or services? Incentives 46. To afford a new gym membership, Blake would have to cut down on movies and pizza on the weekends. The economic term for Blake giving up movies and pizza is… Opportunity cost 47. Bob is working a full time summer job to help pay for his first year of college. Bob was invited to go on a summer trip with a group of his friends, but he declined the invitation. What was the opportunity cost of Bob’s decision? Bob will miss the chance to spend time with his friends 48. The city of Mayfair wants to build a new state-of-the-art public library to replace iys existing eighty-year-old library building. The city also wants to renovate the town’s soccer stadium to increase seating and revenues. The town project cannot accommodate both projects. What is the opportunity cost of choosing the stadium? Library patrons will have to make due with the old facility. 49. The city wants to build an additional runway and a new terminal building at the local airport. The goal is to create more space for airplane traffic and the travelers coming through the airport. The plan involves acquiring and demolishing 200 homes. If the city chooses to go ahead with the expansion, what will be the opportunity cost to the city? The city will lose income in the form of property taxes from the demolished homes. 50. Any resources that are made by humans and used to create other goods and services are called… Capital 51. The resources used to make all goods and services are called the… Factors of production 52. The purpose of a production probability graph is to… Show alternative ways to use an economy’s resources. 53. An efficient economy is one that… Uses its resources to make the most goods and services. 54. The law of increasing costs means that when an economy increases the production of one item… The opportunity cost goes up 55. The opportunity cost of a decision can be examined by using a… Production possibilities graph 56. Production possibilities frontiers curve when they are charted on a graph because they show… The increasing costs resulting in increasingly less output 57. Why are all goods and services scarce? All resources are scarce 58. What is the opportunity cost of a decision? The most desirable alternative given up for the decision 59. What is a factory building an example of? Physical capital 60. How would you describe an economy that uses its resources to make the greatest possible number of goods and services? Efficient 61. What does a production possibilities frontier show? The maximum amount that an economy can produce 62. The lack of which of the following represents a scarcity? Enough workers to finish two jobs because there’s a limited supply of workers 63. Which of the following makes someone an entrepreneur? Running a service that requires people to install sprinkler systems in lawns 64. A country’s production possibilities increase because the available workers become more skilled at using a computer. This is an example of growth caused by… Technology 65. You bought two new CD’s with the last 30 dollars in your checking account, and your next payday is on Monday. What is he opportunity cost of these CD’s? Dinner and a movie with your friends tis Saturday Night. 66. A nation’s automakers install new robotic machinery to make cars. Now, cars only take a day to make, and the factories can produce many more cars than before. This is an example of growth caused by… Technology 67. The community of Desertville traditionally produces a large number of tires and a small amount of kiwi fruit. Kiwis are becoming increasingly popular and Desertville has decided to expand kiwi cultivation and decrease tire manufacturing. According to the law of increasing laws… The cost of producing kiwis will increase 68. The physical capital used by a wood worker to make furniture would include… Real estate property tax 69. Which term describes the table that lists the quantities of a product or service over a range of possible prices? Law of demand 70. According to the _____, quantity demanded and price move in opposite directions. Law of demand 71. Competing products are called _____ because consumers can use one in the place of another. Substitutes 72. Which term refers to an extent in which a change in price causes a change in demand? Demand elasticity 73. A knowledge of demand is necessary to understand how a _____ works. Market economy 74. Demand for a good in a particular market area is related to the number of _____ in the area. Consumers 75. _____ refers to the desire, willingness, and ability to buy a good or service. Demand 76. What is the term for the principle that suppliers will normally offer more for sale at higher prices and less for sale at lower prices? Law of Supply 77. A _____ is a graph showing the quantities supplied at each possible price. Supply curve 78. Which term describes the combination of supply schedules for all businesses that provide the same good or service? Market supply 79. Which term refers to the methods or processes used to make goods and services? Technology 80. _____ helps answer what to produce, how to produce, and for whom to produce. Price 81. Which term refers to the various quantities of a good or service that producers are willing to sell at all possible market prices? Supply 82. _____ is the money a business receives for its products and services over and above its costs. Profit 83. The _____ is the point at which there is neither a surplus nor a shortage. Equilibrium price 84. The point at which the supply and demand curves for a given product intersect represents the… Equilibrium price 85. The price at which quantity demanded and quantity supplied are equal is known as the… Equilibrium price 86. North Korea’s economic system differs from the U.S. economy because it is based on… Central planning 87. What is one of the primary advantages of a free market system? Prices are determined by supply and demand 88. Which question addresses the most fundamental issue for an economic system? What goods will be produced? 89. Which factor is most fundamental in determining what a market economy will produce? Price 90. _____ are accounts that require the deposit to remain in the bank for a certain period of time. Certificates of deposits 91. Which economic activity is least likely to contribute to global economic interdependence? Tariffs 92. What kind of market runs most efficiently when one large firm supplies all of the output? Natural Monopoly 93. Which financial institutions offer full banking services to individuals and businesses? Commercial banks 94. Which characteristic of a monopoly represents a disadvantage for consumers? The control of prices 95. During an economic recession, rising unemployment generally leads to… Reduced demand for goods 96. Even in a free market, governments sometimes allow “natural monopolies,” in which competition is severely limited or even nonexistent. In which industry is a natural monopoly most likely to be permitted? Electric utilities 97. Why does the government sometimes give monopoly power to a company by issuing a patent? The company can then profit from their research without any competition. 98. Alex needs to calculate the amount of money h expects to earn in the coming month. He also needs to identify all of his expenses or the month to determine the amount of money left over. What should Alex make to evaluate his expenses? A budget 99. What organizations do some workers join in order to obtain higher pay and better working conditions? Labor unions 100. What is one reason the U.S. economy relies on other countries? Some goods and services can be produced at a lower cost in other countries 101. _____ includes both coins and paper money. Currency 102. _____ accounts allow bank customers to write checks or use check cards. Checking 103. The unemployment rate for White Collar Workers remains constant or falls during periods of economic expansion. However, the unemployment rate for migrant workers fluctuates throughout the year, even during periods of economic expansion. What is the most likely explanation for this fluctuation? Farm work is seasonal 104. What is monopolistic competition? Many companies selling similar but not identical products 105. _____ occurs when we lack the resources to produce the things we want. Scarcity 106. The price at which quantity demanded and quantity supplied are equal is known as… Equilibrium Price 107. John owns a landscaping business in Buffalo, New York. Each November, he lays off nearly all of his and does not hire or rehire any workers until the following April. Which type of unemployment are John’s employee facing? Seasonal unemployment 108. What is one type of monopoly the U.S. government generally permits? Professional sports leagues 109. Resources needed to produce goods and services are called… Factors of production 110. In economics, scarcity exists because people… Choose which preferences to satisfy with limited resources 111. In a system of perfect competition, producers will… Accept market prices set by supply and demand 112. In which way does global trade lead to buyer prices? Global trade increases competition 113. The U.S. exports technology to Europe, buys cars from Japan, and imports oil from the Middle East. What does thios pattern represent? Global Interdependence 114. According to the _____, quantity demanded and price move in opposite direction. Law of demand NOTE I am not sure #36 is correct There may be some double within the study guide Some questions were not included because they refer to various graphs and charts Arabie only has 100 questions on the exam… so not all questions will be used. Big thanks to those letting me use bellringers. Huge help Good Luck!
