| 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 |
