Taxes
What is the main purpose of taxes in an economy?
What is to fund government services?
What market structure has many sellers and identical products?
What is perfect competition?
What happens to the quantity demanded when the price increases?
What is it decreases?
What is the simplest and most common type of business ownership?
What is a sole proprietorship?
What are the four phases of the business cycle?
What are expansion, peak, contraction, and trough?
What type of tax takes a higher percentage from low-income earners?
What is a regressive tax?
Which market structure is dominated by a few large firms?
What is an oligopoly?
What is the point where supply equals demand called?
What is equilibrium?
A business owned by two or more people is called what?
What is a partnership?
What is a period of declining GDP and rising unemployment called?
What is a recession?
Sales taxes and excise taxes are examples of what kind of tax?
What are indirect taxes?
What market structure features only one seller?
What is a monopoly?
What does a rightward shift of the demand curve indicate?
What is an increase in demand?
What is a major advantage of a corporation?
What is limited liability?
What phase of the business cycle is associated with full employment and growth?
What is expansion?
What is the term for income remaining after taxes are paid?
What is disposable income?
In monopolistic competition, how do firms differentiate themselves?
What is through branding and advertising?
What factor causes movement along the supply curve?
What is a change in price?
What type of merger combines companies involved in different stages of production?
What is a vertical merger?
What is stagflation?
What is a period of slow growth combined with inflation?
Compare the effects of a progressive tax system and a regressive tax system on income inequality. Include how each affects different income groups.
What is: A progressive tax system reduces income inequality by taxing higher incomes at higher rates, while a regressive tax system increases inequality by taking a larger share of income from low earners than high earners?
What are two barriers to entry in a monopoly?
What are high startup costs and legal restrictions?
The government imposes a price ceiling on rental housing that is below the market equilibrium. What is the likely impact on supply, demand, and the overall housing market?
What is: Quantity demanded will increase, quantity supplied will decrease, leading to a shortage of rental housing, as the price ceiling prevents the market from reaching equilibrium?
In a capitalist economy, how do the principles of private property, competition, and the profit motive work together to allocate resources efficiently?
They encourage individuals to use resources productively—private property gives ownership incentives, competition drives innovation and lower prices, and the profit motive rewards efficiency and meeting consumer demand?
What are two major tools of monetary policy and two major tools of fiscal policy?
Monetary policy tools – changing the interest rate and open market operations
Fiscal policy tools – increasing government spending and cutting taxes