Economic Policy 101: A Crash Course



US Gov/Ms. Strong Name____________________________Per___

Economic Policy 101

Directions – You will research economic policy usually a variety of sources, and define the terms below.

• Magruder’s textbook (Ch 16 Financing Government, glossary, etc.)

• Online sources

I. Economics: The Basics

|Economic Term |Definition |

|Economics | |

|Supply and Demand | |

| | |

| | |

| | |

| | |

|Economic Policy | |

II. Where does the Government get its revenues i.e. taxes?

|Type of Tax |Definition |Examples |

|Progressive Tax | | |

|Individual Income Tax | | |

|Corporate Income Tax | | |

|Payroll (Entitlement) Tax | | |

|Regressive Tax | | |

|Excise Tax | | |

|Estate Tax | | |

III. Why does the government borrow money?

|Budget Term |Definition |

|Budget | |

|Interest | |

|Budget Deficit | |

|Budget Surplus | |

|National (Public) Debt | |

IV. Where does the government spend its money?

|Type of Spending |Definition |

|Mandatory or “Uncontrollable | |

|Spending | |

|1) Interest on the Debt | |

|2) Entitlements | |

| a) Social Security | |

| b) Medicare | |

| c) Medicaid | |

|Discretionary or “Controllable| |

|Spending” | |

|1) Defense Spending |• How much did the U.S. Government spend on defense in 2004? |

| | |

| |• Why does the government spend so much on defense? |

|2) Non-defense Spending |From the table on p. 468 (2013e)/460 (2005e) aside from defense spending, what were the top 3 departments spent the most money|

| |in 2004? |

| |1) 2) 3) |

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