Functions of the Government

Economy Regulation

100

True or False: The government sector of the GDP has decreased over time.

False

It has increased from 15% to 50%

200

What type of economy does the US have?

Capitalist

300

What is an example of fiscal policy?

Regulating taxes and government spending

400

What is an example of monetary policy? 

Controlling the money supply or changing interest rates

500

Which economic regulation technique is the following: The government raises taxes for the top bracket in order to increase social welfare funding.

Redistribute income

Providing Public Goods & Services

100

True or False: Set-up costs are expensive

True

200

What social problem can government services help reduce?

Poverty

300

What is one possible downside of less competition in government services?

Reduced quality

400

What is an example of the "Free rider problem"

In a group project students equally contribute. While others rely on the students doing the project so they benefit from the shared grade.

500

What two problems should government balance to avoid when providing goods and services?

High costs and inefficiency

Change in Taxation Policy

100

True or False: larger divide is under social cost as people from the left and right seriously disagree over how to handle it.

False (People from top and bottom see larger gap)

200

Which label would lack of bipartisan support fall under?

Political Cost 

300

Name one social benefit of changing taxation policy.

• Encouragement of Social Mobility

• Family Support 

• Less Poverty

400

Name one economic benefit of changing taxation policy.

• Encourage Investment 

• New Innovative Ideas

• Economy Boost  

500

Why might a larger federal debt be considered an economic and political cost of changing taxation policy?

Political: Neither major party wants to be responsible for increasing the debt.

Economic: It is directly related to money.

Government Role in International Trade

100

What is one way governments help domestic industries compete with foreign products? 

By using tariffs or other protectionist measures. 

200

What type of standards do governments enforce to protect consumers and the environment?

Health, safety, and environmental standards. 

300

What are tariffs, quotas, and subsidies used for in international trade? 

To balance domestic industrial growth with global market access. 

400

What is the purpose of trade agreements between countries?

To reduce trade barriers and open new export markets. 

500

What are three reasons governments impose tariffs on imported goods?

To generate revenue, protect domestic producers, and encourage people to buy local products.