AP Gov. @ PHS - unit 5 chapter 19

Quiz yourself by guessing what should be in each of the black rectangles below before clicking on it to display the answer.
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vocab
definition
fiscal policy  gov. policy that attempts to manage the economy by controlling taxing and spending  
monetary policy  gov. policy that attempts to manage the economy by controlling the money supply and interest rates  
tariff  tax on imports to protect industries, labor, and farmers from foreign competition/raise revenue  
excise tax  consumer tax on a specific kind of merchandise  
progressive tax  people with higher incomes pay a larger fraction of their income than people with lower incomes  
regressive tax  people with lower incomes pay a higher fraction of their income than people with higher incomes  
deficit  difference between revenues raised annually and the amount spent including paying the interest on past borrowing  
debt  accumulated total of federal deficits, minus surpluses, over the years  
GDP  gross domestic product: estimate of total output of all economic activity in the nation, icluding goods and services  
OMB  Office of Management and Budget: Presidential staff agency that serves a a clearing house for budgetary requests and management improvements  
sales tax  general tax on sale transactions (sometimes exempts food and drugs)  
CBO  agency of congress that analyzes residential budget recommendations and estimates the cost of proposed legislation  
tax expenditures  loss of tax revenue due to federal tax laws that provide special tax incentives or benefits to individuals or businesses  
GAO  General Accounting Office: independent investigative arm of Congress that checks on reciept and disbursement of public funds and reviews the performance of gov. agencies  
laissez-faire economics  theory that opposes gov. interference in the economy beyond what is necessary to protect life and property  
keynesian economics  theory that gov. spending should increase during business slumps and be curbed during booms  
trade deficit  imbalance in international trade in which the value of imports exceeds the value of exports  
WTO  World Trade Organization: international org. derived from GATT; promotes free trade around the world  
GATT  General Agreement on Tariffs and Trade: international trade org. that seeks to encourage free trade by lowering tariffs and other trade restictions  
NAFTA  North American Free Trade Agreement: agreement between US, Canada, and Mexico to form largest free trade zone in the world  
protectionism  policy of creating trade barriers to protect domestic industry  
independent regulatory agency  gov. agency responsible for enforcing particular statutes; exits outside the three branches of gov.  
deregulation  policy that promotes cutbacks in amount of federal gov. by returning many functions to the states  


   

 
 

 
 

 

 
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