Unit 1
Unit 2
Unit 3.1
Unit 3.2
Unit 3.2 Cont.
100
The study of Economics is the study of . . .
Choice under Scarcity
100
Draw a supply and demand line AND the equilibrium AND label the x and y axes.
Supply: linear line up
Demand: Linear line down
Equilibrium: where the lines meet
X: Quantity
Y: Price
100
What role do INCENTIVES/SELF-INTEREST play in self-regulating the free market economy?
* people want to specialize and make better products because it benefits THEMSELVES
* People will want to do what will please the people because it benefits THEMSELVES
100
The two most major purposes of a bank
to hold money and lend money
100
These are the two things taxes MUST be used for according to the Constitution
To provide for the common defense and promote the general welfare
200
The difference between tangible and intangible benefits
Tangible: a benefit of your work that has a monetary value (ex: dental insurance or tips)
Intangible: a benefit of your work that does not have a monetary value (ex: you like your coworkers)
200
What is the relationship between price and demand
Demand goes up, price goes down. Indirect Relationship. This is because people want to buy more of what is less expensive.
200
What is the #1 factor that impacts the labor market and how does it impact it?
Technological developments -- does NOT change the amount of jobs, but rather, changes the types of jobs available in the labor market
200
Explain the difference between simple and compound interest
Compound interest: interest paid on the total amount (principle + interest)
Simple Interest: interest paid ONLY on the principle amount
200
Calculate the sales tax owed given the following situation:
Jeremy just bought a used car for 10,000 dollars. For this purchase, the sales tax would be 5%.
500 dollars
300
The difference between scarcity and shortage
Shortage is temporary, not having enough supply to fit demand in that moment, specific to certain goods/services.
Scarcity is a human condition, forever, having unlimited wants and limited resources to fill those wants, pertains to all wants and people, NOT just specific goods or people
300
The relationship between price/supply AND WHY it is that way
Supply goes up, price goes up. Direct Relationship. This is because producers want to make MONEY so they will sell more of what is making them money.
300
What 3 states in the U.S. are the most impoverished?
Mississippi, Louisiana, New Mexico
300
Define what the FED is and list three things it does/roles that it has
The FED: The Federal Reserve, Central Bank of the U.S., the bank for banks
Roles:
Conducting Monetary Policy
Promoting financial system stability
Supervising and Regulating Financial Institutions and Activities
Fostering Payment and Settlement System Safety and Efficiency
Promoting Consumer Protection and Community Development
300
Take a look at the following tax brackets for income tax:
Earning 00000 - 50,000 taxed at 20%
Earning 50,000 - 100,000 taxed at 30%
Earning 100,000 - 150,000 taxed at 40%
When looking at all brackets put together, what tax structure is being used: progressive, regressive, or proportional?
Progressive, because as the base increases, the rate increases as well.
400
Say an economy is producing 75 units of toys and 100 units of calculators. Would this be an efficient use of resources? Answer and explain.
No, because this economy has the resources to produce more toys and calculators. 75 and 100 is NOT the most efficient use of resources.
400
Explain WHAT DETERMINANT is being showcased in this example and how it would shift either supply or demand of STANLEY CUPS:
Stanley Cups became extremely popular in the past few years. However, recently, many companies like Temu, Amazon, and Walmart have been producing their own versions of these cups that are much, MUCH cheaper and more accessible. These alternative versions, or knock offs, look fairly identical to Stanley Cup's own Water bottle.
SUBSITUTES; Demand shifts INWARD
400
What two types of locations "cause" poverty?
Extremely urban areas, Extremely rural areas
400
Explain the difference between the following:
Savings accounts, CDs, and Money Markets
Savings accounts accumulate a little interest but can be withdrawn from at any time.
Money Markets accumulate more interest, but you can write only a limited amount of checks. Restricted access.
CDs: accumulate more interest, No funds removed until the end of a certain time period
400
What are the top 4 categories America spends our taxes on?
Health Insurance, Social Security, Defense, Interest on Debt
500
You must choose between the following jobs you have been offered. Explain one MB, one MC, and the Opportunity Cost of EACH option.
Job 1: Hairstylist
Job 2: Heart Surgeon
MB: a benefit you gain from making that choice
MC: an opportunity or thing you LOOSE in making that choice
Opportunity Cost: THE MOST IMPORTANT MC!
500
Explain WHAT DETERMINANT is being showcased in this example and how it would shift either supply or demand of STANLEY CUPS:
The government decides to subsidize Stanley Cups.
Gov. Subsidies; Supply line shifts outward
500
list two Anti-Poverty Government Programs and explain how each try to combat poverty.
Incentive programs, Enterprise Zones, Welfare Programs, Employment Assistance, Earned Income Tax Credit, Housing Assistance
500
How does the Fractional Reserve System work and what is the purpose of having a bank operate on this type of system?
500
Calculate the following payroll tax:
This household makes 100,000 dollars a year in salary income. They also make 2,000 dollars a year from returns and interest on their investments. The payroll tax in this economy is 10%.
10,000 (salary income alone is used as the tax base for payroll taxes)