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Goal 9

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NC Civics and Economics: Goal 9

NC Civics and Economics: Goal 9

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  • 1. GOAL 9
    NC Civics and Economics
  • 2. Gross Domestic Product and The Business Cycle
  • 3. Gross Domestic Product(GDP)
    A measurement of all that is produced within a country in one year.
  • 4. Per Capita GDP
    GDP divided by a countries population
    In other words: The GDP per person
  • 5. The Business Cycle
    Expansion
    Peak
    Contraction
    Trough
  • 6. Peak (a.k.a. “Boom”)
    Economy is at its HIGHEST
    Unemployment at its LOWEST
  • 7. Contraction (a.k.a. “Recession”)
    Economy is DECLINING
    Unemployment is RISING
  • 8. Trough (a.k.a. “Depression”)
    Economy is at its LOWEST
    Unemployment is at its HIGHEST
  • 9. Expansion
    Economy is IMPROVING
    Unemployment is FALLING
  • 10. CPI
    Stands for Consumer Price Index
    Measures inflation rates for the nation’s economy
    Inflation – the general rise in the price of an item over time.
  • 11. Government Economic Regulations
  • 12. Social Security Act of 1935 (SSA)
    WHAT IT DID
    Established unemployment, retirement and disability insurance
    IMPACT ON US ECONOMY
    Gave citizens a sense of security if they were to have hard times (secure with your money =spending money=better economy)
  • 13. National Labor Relations Act, 1935
    WHAT IT DID
    Created the National Labor Relations Board (NLRB)
    Workers have the right to join unions and use collective bargaining
    IMPACT ON THE US ECONOMY
    Gave protection and power to the workers
  • 14. Fair Labor Act, 1938
    WHAT IT DID
    Est. the 1st minimum wage of 25 cents per hour and time and a half for working over 40 hours per week
    IMPACT ON THE US ECONOMY
    Workers must be treated fairly and paid accordingly
  • 15. Taft Hartley Act, 1947
    WHAT IT DID
    Put restrictions on labor unions
    Employee doesn’t have to be a member of the union to be hired
    IMPACT ON THE US ECONOMY
    Unions cannot be all powerful
    President can delay a union strike for 80 days if it will threaten “national health or safety”
  • 16. How might government deregulation affect the US Economy?
    Allows firms to compete in free-markets
    Removes gov’t restrictions like entry barriers and price controls
  • 17. United States and International Trade
  • 18. NAFTA
    North American Free Trade Agreement
    goal to eliminate all tariffs and trade barriers between Canada, the United States, and Mexico by 2009.
  • 19. Interdependence
    Countries are dependent on one another in order to focus on what they have an advantage in producing.
  • 20. Barriers to Free Trade
    Tariffs
    Quotas
    Embargoes
  • 21. Tariffs
    Taxes placed on imported goods
    increase the price and cost of shipping items
  • 22. Quotas
    Limits placed on items
    Ex. Import Quota – a limit on the amount of a good that can be imported
    The U.S.A. can only import…
    908, 764 kilograms of raw cotton from India and Pakistan.
    621,780 kilograms of raw cotton from China
    355,532 kilograms of raw cotton from Egypt and Sudan
  • 23. Embargoes
    political tools used to economically hurt another country by not trading with them Ex: CUBA
    U.S. Trade Embargo against Cuba. It is illegal to trade with companies in Cuba, we disagree with the communist ruler Fidel Castro and his government. We are hurting Cuba economically by not trading and raising the living standards of the country.
  • 24. Question?
    How does the table on p.3 of your qualifier illustrate the United States unfavorable balance of trade?
    The US’s imports are greater than its exports. The balance is negative so the balance of trade is unfavorable.
  • 25. Taxes
  • 26. Regressive Tax
    Purpose:
    As income increases, the percentage of taxes paid decreases
    Hurts the poor
    Example:
    Sales Tax
  • 27. Progressive Tax
    Purpose:
    As income increases the percentage of taxes paid increases
    Hurts the rich
    Examples:
    Income Tax
  • 28. Excise Tax
    Purpose:
    A tax on the sale or production of luxury or harmful goods
    Examples:
    Tax on cigarettes, alcohol, gasoline
  • 29. Interest Rate
    A percentage that is charged or paid for borrowing money
    Higher interest rate=less spending/borrowing
  • 30. Fiscal & Monetary Policy
  • 31. What is the purpose of Fiscal and Monetary Polices?
    To ensure economic expansions and contractions are not to severe
    NOT
  • 32. Fiscal Policy
    The use of government (Congress) spending and revenue collection to influence the economy.
  • 33. MONETARY POLICY
    The actions taken by the Federal Reserve to influence the stability of the economy
  • 34. Economic Problem: Inflation
    Occurs when the market is flooded with too much money in the hands of consumers
    So… the Goal is to DECREASE the amount of $ in the hands of consumers
  • 35. Fiscal Policy(Congress)
    (Increase) Taxes
    (Decrease) Gov’t Spending
    (Decrease) Welfare payments
    TIGHT Fiscal Policy
  • 36. Monetary Policy(Federal Reserve)
    (Increase) Interest (Discount) Rates
    (Increase) Reserve Ratio
    Sell Bonds
    TIGHT Monetary Policy
  • 37. Economic Problem: Unemployment
    Occurs when the market slows down due to a lack of consumer spending.
    So… the Goal is to INCREASE the amount of $ in the hands of consumers
  • 38. Fiscal Policy(Congress)
    (Decrease) Taxes
    (Increase) Gov’t Spending
    (Increase) Welfare payments
    LOOSE Fiscal Policy
  • 39. Monetary Policy(Federal Reserve)
    (Decrease) Interest (Discount) Rates
    (Decrease) Reserve Ratio
    Buy Bonds
    LOOSE Monetary Policy
  • 40. REQUIRED RESERVE RATIO
    Money the banks have to keep “RESERVE” at the bank.
  • 41. DISCOUNT RATIO
    The interest rate the federal reserve charges banks to borrow money.
    FYI – this is one that the name does not match what it is but you just have to remember
  • 42. BONDS
    Sold by the federal reserve and increases in value over time
  • 43. FEDERAL RESERVE
    The bank owned by the Federal government.
    Does not work with the public only with other banks.
  • 44. United States and International Trade
  • 45. NAFTA
    North American Free Trade Agreement
    NAFTA impacts the United States because its goal is to eliminate all tariffs and trade barriers between Canada, the United States, and Mexico by 2009.
  • 46. Interdependence
    When countries rely on each other for certain goods.
  • 47. Barriers to Free Trade
    Tariffs
    Quotas
    Embargoes
  • 48. Tariffs
    Taxes placed on imported goods
    These increase the price and cost of shipping items to consumers in other countries
    Ex. Customs Duty - a tax placed on certain items purchased in other countries
  • 49. Quotas
    Limits placed on items
    Ex. Import Quota – a limit on the amount of a good that can be imported
    The U.S.A. can only import…
    908, 764 kilograms of raw cotton from India and Pakistan.
    621,780 kilograms of raw cotton from China
    355,532 kilograms of raw cotton from Egypt and Sudan
  • 50. Embargoes
    Are political tools used to economically hurt another country by not trading with them.
    U.S. Trade Embargo against Cuba. It is illegal to trade with companies in Cuba, we disagree with the communist ruler Fidel Castro and his government. We are hurting Cuba economically by not trading and raising the living standards of the country.
  • 51. Balance of Trade
    The monetary difference between the exports and imports of merchandise.
    Charts demonstrate a countries unfavorable balance of trade by showing the countries exports are less than their imports