Study Guide – Exam #1 E Q .

GOVT 2301
Fall 2002
Study Guide – Exam #1
ESSAY QUESTIONS. Answer the following questions in a thorough essay (separate
essay for each question). Organize your essay(s) around a thesis statement. Include
an introduction, separate paragraphs developing your supporting arguments, and a
conclusion. A complete answer is one that addresses all parts of the question. Write
complete sentences and pay attention to spelling, grammar, and word choice. Do
NOT assume that “the instructor will know what you mean.”
1. Discuss the utility of the systems model of policy-making. Diagram the model,
identifying and explaining each of its component parts.
2. Discuss the five stages of the policy-making process (the production line model).
Outline the activities and actors that may be involved in each stage.
3. Using a straight-line continuum, indicate and discuss the role of government in
the American economy? Why is the American economy considered a “mixed
economy”? Discuss two broad types of economic functions performed by
government, providing examples of each. Specifically, discuss government’s role
in promoting the ideal of competition in the economy, in redistributing wealth, in
providing public goods and services, in countering externalities, and in
stabilizing the economy. Illustrate your points with examples.
4. Explain when government should pursue an expansionary fiscal policy and when
it should pursue a contractionary fiscal policy according to Keynesian economic
theory. Discuss what each of these entail. Outline the timing and political
problems encountered when applying fiscal policy in the “real world.”
SHORT ANSWER QUESTIONS. Answer the following questions in a paragraph (a
separate paragraph for each question). Do NOT answer specific parts as separate
items. Integrate your responses into a well-organized, well-constructed paragraph.
A complete answer is one that addresses all parts of the question. Write complete
sentences and pay attention to spelling, grammar, and word choice. Do NOT assume
that “the instructor will know what you mean.”
1. Discuss Laswell’s, Easton’s, and Feagin’s definition of politics.
2. Define government. Explain why, in American society, government is perceived
as the legitimate institutional arrangement to impose binding decisions on
3. Outline and discuss public policy’s five defining characteristics.
4. Identify and describe four types of economic systems found in the “real” world.
5. Outline and explain the basic tenets of capitalist economic theory. What are the
implications of these assumptions?
6. Distinguish between pure public goods and pure private goods. Provide
examples of each. Explain the free-rider problem.
7. Distinguish between positive and negative externalities. Provide examples of
each. What actions might government take to counter each?
8. Explain the criticism of expansionary fiscal policy that arises from the Ricardian
Equivalence Theorem.
9. What do economists mean by the “crowding-out effect”? What are its
implications for an expansionary fiscal policy?
10. How can monetary policy be used to stabilize the macroeconomy? What
arguments do critics make with regards to the effectiveness of monetary policy?
IDENTIFICATION ITEMS. Define and identify the importance of the following items in
a sentence or two for each. These items can generally be answered in two or three
sentences. Students should go beyond simple definitions of the terms or concepts to
say why each is important. It is possible that two terms may be paired in
identification items. Your answer should be written to demonstrate your familiarity
with and understanding of both terms or concepts in each pair. In this case, you
should explain why the two are juxtaposed. Here is an example:
[example] Article I, sec. 8:18 v 10th Amendment – Article I, sec 8:18 implies
that the national government has powers beyond those that are expressly
delegated in the Constitution while the 10th Amendment reserves for the states
any powers not delegated by the Constitution to the national government.
These provisions reflect the competing political philosophies of the
Federalists and the Anti-Federalists respectively; consequently, the question
of the balance of constitutional powers between the two levels of government
must be resolved by judicial interpretation.
authoritative government
authoritarian government
policy outputs
policy statements
implementing actions
target group
input structures
conversion structures
public agenda
official agenda
positive externality
Keynesian economics
aggregate demand
productive capacity
fiscal policy
monetary policy
”crowding-out effect”
policy outcomes
pure capitalism
laissez-faire capitalism
centrally-planned economy
market capitalism
market socialism
command socialism
command capitalism
mixed economy
asymmetrical information
”natural” monopoly
transfer programs
price ceiling
price floor
progressive tax
regressive tax
free-rider problem
public good
private good
negative externality
Ricardian Equivalence Theorem
Please bring a “clean” blue book to class with you on test day. Place the blue
book on the table at the front of the classroom. The instructor will then distribute
blue books to the class.
You will have the entire class period to complete the exam. You should use as
much of that time as necessary to answer the exam questions thoroughly. Your
primary objective probably should not be to get out of class early.
Please do NOT write answers to test items in outline form or use incomplete
sentences. We are administering written-format exams this semester in lieu of an
outside writing assignment (i.e., research paper) to fulfill the writing
requirement for the course. Your ability to write the English language effects
your ability to communicate your understanding of the concepts and themes of
this course.
Write legibly!! PRINT if necessary! Write LARGE enough for the instructor to
read your answers. The instructor will not grade illegible answers.
Do NOT hesitate to ask questions of the instructor concerning any of the
information you do not understand. The best time to ask questions is before
rather than after the exam. Of course, during the exam is completely out of the
It is the view of the instructor that the best way to prepare for the exam is to
spread your studying out over the course of several study sessions. “Cramming”
or setting aside a single block of time to study, regardless of the length, usually
does not promote genuine understanding of concepts, themes, or major
This study guide has been prepared to include the major themes, concepts, and
emphases covered in class, as well as specific information from class lectures.
Take full advantage of this study guide. I advise you to write out answers to ALL
of the questions on this study guide, in as complete fashion as you would if you
were writing answers for the actual exam. Then, study the answers you have
written as opposed to studying from your notes. Of course, the gamblers among
you will attempt to determine which questions they believe are likely to appear
on the actual exam and only prepare answers to those questions. The questions
that you will see on the exam are included in the study guide before you. It is up
to you to utilize it in the way that maximizes your benefit. In short, the exam will
essentially be a test of your preparation! Therefore, if you choose not to prepare
yourself and do poorly, you have no one to blame except yourself; nothing to
fear but fear itself; make your bed, now lie in it; dance with them that brung ‘ya;
to get along, go along; the squeaky wheel gets the grease; ‘tis better to give than
to receive; spare the rod, spoil the child; ask not what your country can do for
you, rather ask what you can do for your country; the early bird gets the worm; a
rolling stone gathers no moss; it’s better to be hacked-off than hack-sawed.
Use the space on the back of this page to add your own hackneyed expressions
and pointless clichés.