Module 5 Flashcards
(18 cards)
According to “The US Economy: Private and Public Sectors”, which of the following are taxes based on wages and salaries?
Payroll Taxes
Which of the following describes how a monopoly controls an industry?
Supply
What is the author’s main theme in “Balancing Liberty and the Pursuit of Well-Being”?
Both freedom and happiness are good, but an imbalance can lead to poor personal decisions.
Molly goes to the grocery store and spends $75 on food. According to “The US Economy: Private and Public Sectors”, which of the following describes her purchase?
Non-durable good
A non-durable good has a life expectancy of less than 3 years.
According to “Balancing Liberty and the Pursuit of Well-Being”, who was the first to urge politicians to design policies that would maximize people’s happiness?
Bentham
According to “The US Economy: Private and Public Sectors”, which of the following are the two reasons describing why people save?
Security and Speculation
Limited liability AND ease of expansion are advantages to which of the following?
Corporations
Which of the following is the most popular ownership structure within the U.S.?
Sole proprietorship
In 1941 households paid approximately 3% of their income in taxes. In the 2000’s, this percentage has grown to:
12%
According to “The US Economy: Private and Public Sectors”, what is the typical amount of income saved by U.S. households?
3%
According to “Balancing Liberty and the Pursuit of Well-Being,” the free market fails to protect supplier interests.
False
The free market fails to protect consumer interests.
How can positive externalities be corrected?
All of the above
- Subsidizing consumers
- Subsidizing suppliers
- Allowing the government to provide goods
According to “The US Economy: Private and Public Sectors: government purchases are exhaustive, while transfer payments are nonexhaustive.
True
According to the reading “The US Economy:..” which of the following is NOT a role of the government:
Minimizing competition
Owners of an organization want to maximize company profits and stock prices while agents (managers) want high pay, regardless of company performance. This is referred to as:
The principal-agent problem
According to the reading “The US Economy:…” how do most people in the US earn income?
Wages and salaries (work for others)
According to “Balancing Liberty and the Pursuit of Well-Being”, the author critiques which political ideology multiple times?
Libertarianism
The portion of household income that is NOT paid in taxes or used to purchase goods is:
personal savings
