Poli. Sci. Ch. 13

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595) What is the source for the money in the Social Security Trust Fund? What is the long-term concern about the Social Security Trust Fund?
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The SSTF gets its money from dedicated taxes and interest paid on the fund’s own investments (the SSTF has invested some of its income into the Treasury, and the interest paid on that investment contributes to the program’s income). It is predicted that in about 20 years the income of the SSTF will fall behind the payouts (to retired/disabled/veterans), thus eventually drying out the program.
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596) In 2008, Congress passed ___________ to help stabilize the investment banking sector.
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The Emergency Economic Stabilization Act
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597) Define inflation.
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Money loses its comparative value as prices increase.
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598) Which of the following helps explain the difficulty in solving the long-term debt problem in the United States?
answer

Paying off the national debt will require a massive increase in federal income; enough to both continue keeping American infrastructure and pay extra money to get rid of the debt. We need a massive surplus of GDP to successfully pay our debt completely off.
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599) What is gross domestic product (GDP) , and what do economists use it to measure?
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GDP is the total net sum of all goods and services in a country over a certain period of time. Economists basically use GDP as the measure of a country’s total wealth.
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600) What is a pension program?
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When someone dedicates a portion of their income flow to a retirement fund.
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601) What is Social Security?
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A government program that aids disabled/retired citizens with money.
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602) What effect would lowering the discount rate have?
answer

It would encourage banks to borrow more and to extend more loans at lower rates
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603) Why might some businesses lobby for increased regulation by the federal government?
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Federal Regulation can sometimes aid businesses, especially in saving them from debt or bankruptcy.
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604) What is Medicare?
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Medicare is a service that was put together by the Congress and Democratic President Lyndon B.Johnson. Medicare covers people over the age of 65. This service is financed by payroll tax of 1.45 percent.
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605) According to Table 13.2, the largest number of Americans benefit from which means-tested program?
answer

Americans benefit from supplemental Security Income.
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606) Is Social Security an entitlement program?
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Yes Social Security is an entillement program.
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607) What is agenda setting?
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Agenda Setting is the process of forming the ist of issues to be addressed by the government.
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608) Are many of the latest regulations enacted by Congress in response to demands from constituents?
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Yes Social Security is an entillement program.
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609) Senior citizens are likely to be concerned about potential cuts to the medical program known as ___________.
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Medicare
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610) What is the main purpose of monetary policy? What is the primary tool that monetary policy uses to affect the overall economy?
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Manipulating Interest Rates
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611) Deregulation of what industry was probably the biggest factor contributing to the economic crisis that began in 2008?
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Deregulation of investment banking industry.
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612) If a government wanted to use monetary policy to increase economic growth, what should it do to interest rates?
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It should decrease interest rates.
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613) What is fiscal policy? What is its main goal?
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Fiscal policy is when a government adjust to its spending levels and tax rates and to monitor the and influenece the nations economy. It is the sister strategy to the monetary policy. Main Goal: To use taxes and government spending to help stimulate or slow down economic growth
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614) A ___________ program distributes benefits on the basis of demonstrated need.
answer

Financial Aid/ Grant
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615) If the Federal Reserve wanted to increase lending by banks, what would it do to reserve requirements?
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They would use the monetary policy
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616) What was the biggest contributor to the economic crisis that began in 2008?
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Deregulation of investment banking industry.
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617) Was the most recent economic crisis a depression?
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yes .
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618) What programs resulted from President Roosevelt’s New Deal?
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Tennessee Valley Authority Act, June’s National Industrial Recovery Act, Public Works Administration, Agricultural Adjustment Act, 12 other major laws, including the Glass-Steagall Banking Bill and the Home Owners’ Loan Act.
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619) What was the policy response by the federal government to the recent financial crisis?
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620) Are benefits under Medicare Part A automatic when a person qualifies for Social Security?
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621) One of the biggest concerns surrounding the Social Security Trust Fund is that __________.
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there will not be enough money to pay future retirees.
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622) Know how to describe laissez-faire economics.
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\”French for, allow to pass or let go: LAISSEZ-FAIRE ECONOMICS approach to things and that the businesses have all the control.
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623) What has been the U.S. government’s recent trend regarding budget deficits and the national debt, and what factors are driving this trend?
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624) Which impact on economic growth can interest rate adjustments by the Federal Reserve have?
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625) What is the debt ceiling? How and why has it been reevaluated in recent years? What has been decided?
answer

.
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626) True of False: The Affordable Care Act, colloquially known as Obamacare, involved a federal takeover of the insurance industry
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FALSE
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627) The Affordable Care Act deals primarily with what policy area?
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Health Care
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628) Would increasing interest rates indicate that the economy is experiencing inflation?
answer

Yes
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629) In an economic slowdown, Keynesian economic policy would recommend doing what?
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Keynesian economic policy relies on taxation and expenditures by government to control inflation and unemployment.
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630) What is a recession?
answer

Period in which real GDP delines for 6 consecutive months
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631) What must mothers due to be eligible to receive benefits under the Temporary Assistance for Needy Families program (TANF) ?
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Must be a U.S citizen, be pregnant or have a child under 19, and have a plan to be self-sufficient.
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632) Why is monetary policy often the preferred way to address an economic crisis?
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Because it is easy to implement and has fewer long term consequences
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633) Why are some safety net programs referred to as entitlements? What are entitlement programs?
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Example of an entitlement progeam is Medicare; Entitlement Programs are government programs that give health benfits for the poor It is a government program that provides benefits to all citizens who meet eligibility requirements.
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634) What provides the greatest source of revenue for the federal government?
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Income Taxes
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635) What is the entity responsible for setting interest rates in the United States?
answer

The FED
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636) Which are the proposed solutions to the long-term problem of solvency in the Social Security program?
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increase the minimum retirement age
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637) What is a government program called that provides benefits to all citizens who meet eligibility requirements?
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An entitlement program
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638) What strategy does monetary policy call for in inflationary periods?
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The Federal Reserve should raise interest rates
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639) Be familiar with Keynesian economic policy.
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Economic theory of total spending in the economy and it effects on output and inflation
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640) What distinguishes a means-tested program from a social insurance program?
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A social insurance program provides benefits based upon lifetime contributions, while a means tested program provides benefits based upon demonstrated need.
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641) What is the difference between a budget deficit and the national debt?
answer

he deficit is the difference between what the U.S. Government takes in from taxes and other revenues, called receipts, and the amount of money it spends, called outlays. total debt as accumulated deficits plus accumulated off-budget surpluses The budget deficit is the amount by which expenditures exceed revenues in a particular year, while the national debt is the cumulative effect of all past budget deficits and surpluses.
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642) Is Social Security available to illegal immigrants?
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No
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643) What is Medicaid?
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subsidized medical care for the poor
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644) What is the primary purpose of the Troubled Assets Relief Program (TARP) ?
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To bail out the banking sector

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