Economy ch.3 – Flashcards
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Why has America been referred to as the land of opportunity
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It provides anyone with the possibility of success through hard work
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What basic principles are fundamental to American free enterprise
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Open opportunity, private property, contract, &voluntary exchange
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In what way does the Bill of Rights protect individuals freedom to engage in business activities
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It recognizes property rights
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What is considered a negative effect of government regulation
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They cut into company profits, they stifle competition and they cause higher prices for consumers
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Which group lists the key principles of free enterprise system
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Profit motive, legal equality, private property, and voluntary exchange
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Business cycles occur in free enterprise systems because
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Economic decisions about factors such as prices, production, and consumption are determined by the market
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The federal government monitors and regulates American banks and other financial institution to?
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To shield money from the damaging effects of economic down tents
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Improved technology helps create a higher standard of living for future generations by
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Providing additional goods and services
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Which are the governments three goals for promoting economic strength
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High employment, steady growth, and stability
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What is one way the government might try to promote economic growth
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Increased spending
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What is critical in determining whether something is produced as a public good
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Whether the benefits to society are greater than total cost
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Why do public goods demonstrate the limitations of a free-market economy
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They allow government to make some economic decisions
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What is the governments role in controlling externalities in the American economy
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Governments try to encourage positive and the negative externalities
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What public goods examples of market failure
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They show that the market economy cannot distribute set in resources efficiently
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Which is a positive externality Of a new high school
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Student purchases at nearby stores
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Various federal, state and local government programs help raise people's standards of living because
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Certain groups of people have fewer opportunities to be productive
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Health insurance for the elderly, the poor, and Disabled is provided by
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Medicare and Medicaid
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Education programs make the economy more productive by
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Adding to human capital and labor productivity
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When did the nation's welfare system begin
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During the Great Depression
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Which of the following programs was President Roosevelt establishing when he spoke these words
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Social Security
