Name: _______________________ Date: __________________________ Block:________ Teacher:_________________
Study Guide: Economics Part II (CE.13 & CE.14) KEY
1. CE.13a - Guiding Question
a. How does the United States government promote and regulate marketplace
competition?
i. In what ways does the government promote marketplace competition?
1. Enforcing anti-trust legislation to discourage the development of
monopolies
2. Engaging in global trade
3. Supporting business start-ups
ii. What are examples of government agencies that regulate business?
1. FCC (Federal Communication Commission)
2. EPA (Environmental Protection Agency)
3. FTC (Federal Trade Commission)
4. What do these agencies do?
a. They oversee the way individuals and companies do business
2. CE.13b – Guiding Questions
a. What types of goods and services do governments provide?
i. What are characteristics of most goods and services provided by the
government?
1. Provide benefits to many simultaneously
2. Would not likely be available if individuals had to provide them
3. Include such things as interstate highways, postal service, and
national defense
b. How do governments pay for the goods and services they provide?
i. Through tax revenue
ii. Through borrowed funds
iii. Through fees (e.g. park entrance fees)
3. CE.13c – Guiding Question
a. How does the government influence economic activity?
i. Taxes
ii. Borrowing
iii. Spending
iv. 16th Amendment: Authorizes Congress to tax personal and business
incomes
Name: _______________________ Date: __________________________ Block:________ Teacher:_________________
4. CE.13d – Guiding Question
a. What is the role of the Federal Reserve System?
i. As the central bank of the United States, the Federal Reserve System…
1. Has a duty to maintain the value of national currency (dollar)
2. Regulates banks to ensure the soundness of the banking system and
the safety of deposits
3. Manages the amount of money in the economy to try to keep
inflation low and stable
4. Acts as the federal governments bank
5. CE.13e – Guiding Question
a. What is the role of the U.S. government in protection consumer rights and
property rights?
i. Individuals have the right of private ownership, which is protected by
negotiated contracts that are enforceable by law.
ii. Government agencies establish guidelines that protect public health and
safety.
iii. Consumers may take legal action against violation of consumer rights.
6. CE.13f – Guiding Questions
a. Why does the government issue currency and coins?
i. When the United States government issues coins and currency, people
accept it in exchange for goods and services because they have
confidence in the government.
ii. Government issues money to facilitate this exchange.
b. Which government agencies are responsible for creating money?
i. The three types of money generally used in the United States are:
1. Coins
2. Federal Reserve notes (currency)
3. Deposits in bank accounts that can be accessed by checks and
debit cards.
7. CE.14 – Guiding Questions
a. What is the role of self-assessment in career planning?
i. Career planning starts with self-assessment.
b. What is the role of work ethic in determining career success?
i. Employers seek employees who demonstrate the attitudes and behaviors
of a strong work ethic.
c. What is the relationship among skills, education, and income?
i. Higher skill and/or education levels generally lead to higher income.
Name: _______________________ Date: __________________________ Block:________ Teacher:_________________
ii. Supply and demand also influence job income.
iii. Employers seek individuals who have kept pace with technological
changes by updating their skills.
d. What influence do advances in technology have on the workplace?
i. Technology and information flows permit people to work across
international borders.
1. This creates competition from foreign workers for United States jobs
but also may create opportunities for United States workers to work
for companies based in other countries.
ii. Being fiscally responsible includes making careful spending decisions,
saving and investing for the future, having insurance, keeping to a
budget, using credit wisely, as well as understanding how contracts,
warranties, and guarantees can protect the individual.
8. Further Clarification:
a. How do debit cards work?
i. Charging your debit card = money pulled directly from your bank
account.
b. How do credit cards work?
i. When you charge your credit card, the credit card company pays the bill,
and you promise to pay them back. If you don’t pay them back on
schedule, there are extra fees.
c. What is inflation?
i. A general increase in prices for goods and services, and an
accompanying fall in the purchasing value of money
d. Consider this scenario:
i. The Federal Reserve wants to stimulate the economy by encouraging
consumers to borrow to that they can spend. What will it do to the
interest rates for borrowers? Answer: It will lower them to make it “cheaper
to borrow money.”
9. Circular Flow (Suggestion: Draw a picture to help you understand.)
a. Businesses pay income as wages/paychecks to households.
b. Households use the income to purchase goods and services from businesses.
c. Both households and businesses pay taxes to the U.S government.
d. Banks issue bonds for the U.S. government.
e. Banks make loans to both businesses and households.
f. Government spending on public goods and services benefits both households
and businesses.
g. Government pays U.S. bond interest to both households and businesses.
h. Households deposit savings in banks.