ECO - Guided Reading and Review Workbook

Guided Reading and
Review Workbook
PEARSON
Prentice
Hall
Needham, Massachusets
Upper Saddle River, New Jersey
Genview, Illinois
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PEARSON
Prentie
Hall
ISBN 0-13-067947-X
11 0605
Student Success Handbook + e o e e e o e = + e e e e e e e e e e e + + + e o e = e + + e = e + e o e + e o o e e o o e e e o 5
Unit 1: Introduction to Economics
Chapter 1 What is Economics?
Section 1 e e + e e e + e + e e + + + + + + e + + + + e + e + e + e e e e + e e e + e e e + e e e e e e e e + e e e e e e e e e e e e e e e e e e e + 17
Section 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . " . . . . . . . . . . 19
Chapter 2: Economic Systems
Section 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 2 + e e + + e e e e e + e e e e e e + e e + e e e e + + e e e e e + e + e e e e e + + e + e e + + + e e + + e 21
Section 3 e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e + e e e e e + e e e e e 22
Section 4 . . . . . . . . . . . . . . . . . . . . . . . . . " . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Chapter 3: American Free Enterprise
"
Section 1 = = = = = = = = = = - = = = = = = = = = = = = = = = = = = = = = = = = = = = = == = = = = = = = = = = = = = = = = = = = = = = = = = = = = = 24
Section 2 e e e e e e e e e e e e e e e e e e + e e + e e e e e + e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e 25
Section 3 e + e e e e e e + e + e e + e + e + e + e + e + + + e e e e e e + o o o o o o e o e e . . . . . . . . . . . . 26
Section 4 o o e o o + o e o + o e o o e o o e o o e o e e e e o o e e o o o o o o e e e e o o e o e o e o e e o o e e o o o e e e e e o e o o o e e e 27
Unit 2: How Markets Work
Chapter 4: Demand
Section 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 2 . . . . . . . . . . . . . . . ' . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Chapter 5: Supply
Section 1 e + e e e o e e e e e e e e e o e e o e e e o e e e o = + o e e e o e = e e e e o e e e e e " . . . . . . . . . . . . . . . . . 31
Section 2 4 e e e e + 4 e e e e e e e + e e e e e e + + e e + + e e + e e + + + e + e + e + e + e e e 4 e + e e + + + e + e e + + e e + + = + + + 32
Section 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Chapter 6: Prices
Section 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Chapter 7: Market Structures
Section 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . " . . . . . . . . 38
Section 3 o e e + o e e e o o o o e o o o e o o o e e o . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . : . . . . . . . . . . . 39
Section 4 e e o + o o e + e o e e e o o o + o + o + e o o + e o e o e o o o o o + e e o e o o o o o e e o e o o e o + e e o o o o o e o e o + o o e 40
Unit 3: Business and Labor
Chapter 8: Business Organizations
Section 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . " . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 2 e e o e + o e e o e + e + e + o e e + o e o e + o + o + w + o + e + e + o + o o o + e o e o + o e o ; . . . . . . . . . . . " . . . . . . . 42
Section 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . " . . . . . . . . . . . . . . . . . 44
Chapter 9: Labor
Section 1 e e e e e + e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e + e e e e e e e e 45
Section 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Unit 4: Money, Banking, and Finance
Chapter 10: Money and Banking
Section 1 .. .. .. ... ... ... ....... .. . . . . . . . .. .. . . .. . . . . .. . . . . . . .. . . ... . . . ... .. . . .. . 48
Section2 e e e e e . . . . e . e . e e e e . e e . .
'
. . . .. .. . . . . .. . .. . ... . .. .. . ' .. . : . . . . . . .. . 49
Section 3 e a . e e e e . A e e e e e e ',' ... ................. ....... .. ... .. ..... 50
Chapter 11: Financial Markets
Section 1 . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . ... . .. . . . . . . .. . .. . . . . . . .. . . . .. . . . . . . . . 51
Section 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 3 ....................................................................... 53
Unit 5: Measuring Economic Perormance
Chapter 12: Gross Domestic Product and Growth
Section 1 ... . . . . .. . . . . . . . .. . . .. . ; . . . . . . ... . .... .. . . . . . . . .. .... .... . . ... . .. .. . .. , 54
Section 2 e . . e e . . . e . . . e e . e . . e . . e e e . e e . . e e . e e e . e . . e . e . e 55
Section 3 e e .e . e e e e e e . e e e e e e e e . . . e e e e e e e e e e e . e e 56
Chapter 13: Economic Challenges
Section 1 ... . . . ... ... * + . . e e e . + e e e e e e e e e e . . e . e e e e 57
Section 2 . e . . . . . e . e e . . e e + e e e e + e e .. e . e . .e e . e e .e e e 4 . e e e 58
Section 3 . e . . . . e . . . . . . ". ... . . . .... . . .. . . . . ... ... . . . . . .. .. . . . . ... . . . .. ... 59
Unit 6: Government and the Economy
Chapter 14: Taxes and Government Spending
Section 1 + + e + + 60
Section 2 e e e e e . . e e e e . e e .e . e e e e e e e e e e . e e . + ... . e e . e .e e e e e 61
Section 3 e e e e e . e . . m e e e e e . e e e . e . e e . e . . e . . . e e . . e + e e e . e e e 62
Section 4 .. .. . .. . . .. . .... . ... .. .. . . . .. ... .. ... . . .. ... .. . . .. . . . . . . . . . . . . . . . . . . . . . 63
Chapter 15: Fiscal Policy
Section 1 . . . . . ... .. . ... .. ... . . ... . . .. . .. .. . . . .... . . ... . . . .. .. .... . . . . . . . . . . .... . 64
Section 2 . . . . e . . . . e e . e . . e e + e e e . .e e e e e e ,. '. . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 3 . . . e e . e e + e n e e + e e + .. e e + e e . e . e . . . e e e e .e e e . e 66
Chapter 16: The Federal Reserve and Monetary Policy
Section 1 . ..... . .. .. ... .. ... .. ..... .. . .. ... . . . . . . . .. . . _ . e . e e e e e e e . . e 67
Section 2 e e e e e + e e e e e e e e e e e e e + e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e e 68
Section 3 e e .e + e e . e . e e . e . e e e e e e e e . e . e e e e e e e .e + e + + + + + + e + 69
Section 4 .. . ... . .. .. ... ... . .. . ..... . . . . . .. ..... .. . . .. . . . . .. . . . .. .. . . . . . . .. ..... . 70
Unit 7: The Global Economy
Chapter 17: International Trade
Section 1 .. .. ..... ... .. .. .. . . . . ... .. . .. . .... . ... .. .. . . . ... . . . . . .. . . . . . . . . . . .. . .. 71
Section 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . e . . e e . . e e e 72
Section 3 ....................................................................... 73
Chapter 18: Economic Development and Transition
Section 1 . . . . . . . ..... . ... . . ...... . . . ... . . .. . . . . . . . .. ... ........ ......... . . . ..... 74
Section 2 e . . e . .. . e . + ..e . . n e ... n . n .. ......+ ..... ............... ............ 75
Section 3 ....................................................................... 76
Section 4 e .e e e e . e . e . . ;.................................................. 77
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Section 1: Guided Reading and Review
Scarcity and the Factors of Production
A. As You Read
As yo read Section 1, supply in the space provided an explanation an economist might give
showing why each statemet is true.
Statement Explanation
1. People must make choices to satisfy their needs
and wants.
1.
2. Scarcity always exists.
2. &
3. Physical capital is an important factor of
production.
4. All goods and services are scarce.
3. &
5. Entrepreneurs are important to the production
of goods and services.
4. ... &
5. a
B. Reviewing Key Terms
Complete each sentence by writing the correct term in the blank.
6. A CD player is a rather than a need because it is not necessary to
survival.
7. The study of how people seek to meet their needs and wants by making choices is
8. Persons who perform such actions as cutting hair or teaching school are providing
9. When producers will not or cannot offer goods and services at current prices, a
occurs.
10. Land, labor, and capital make up the
11. When people make resources for producing other goods and services they are creating
12. The term refers to water, forests, and all other natural resources
used to produce goods and services.
13. The two categories of capital are physical and
14. Factories, machinery, and pencils are all examples of capital.
15. Leaders who take risks to develop original ideas and start new industries are called
Guided Reading and Review Chapter 1 17 1
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Opporunity Cost
A. As You Read
As you read Section 2, fill in two supporting facts or detils under each main idea by answering
each queston.
Ma Idea: Trade-offs are alteratives that people give up when they choose one course of action
over another.
1. Who makes trade-of? @@ @@ @@@@@@
2. Why do decisions involve trade-ofis? @@@@@@@@@@
Ma Idea: Opportunity cost is the most desirable alternative given up as te result of a deision.
3. How does opportunity cost vary? +@@@
4. Why does opportunity cost vary? =@@@@@@@@@@@@@=
Ma Idea: Deciding whether to do or use one more or one less unit of some resource is thinking
at the margin.
5. What does thinking at the margin help with?
6. What does thinking at the margin help compare? @@@@@@@@
B. Reviewing Key Ters
Answer each of the following questions.
7. I what way are tade-ofs and opportunit costs alike?
8. How does an opportunity cost differ fom a trade-off?
9. What are "guns or butter" decisions?
10. How does thinking at the margin change the decision-making process?
( 18 Chapter 1 Guided Reading and Review
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Production Possibilities Curves
A. As You Read
As you read Section 3, complete the chart by indicating where on a production possibilities
curve the following information is shown.
Reading a Produc'lion Possibili'lies Curve
1. Categories or specific goods or services to be compared
2. Range of choices in the combination of goods or services produced
3. Production possibilities frontier
4. A economy working at its most efficient production levels
5. A economy working below its most efficient production levels
6 Future production possibilities frontier if more land, labor, or capital resources
become available
Define the following terms. ,
7. production possibilities curve ,,
8. production possibilities frontier ____.
9. efficiency ,
10. underutilization ,,
11. cost .............................
12. law of increasing costs ,,,,,,,,,,,,,,,,,,,
Guided Reading and Review Chapter 1 19 '
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The Free Market
A. As You Read
As you read Section 2, list the role or roles played in a free market economy by each factor in the
diagram below.
Roles and Functions in a Free Market Economy
Businesses
B.Reviewing Key Terms
Match the definitions in Column I with the terms in Column II. Write the letter of the correct
answer in the blan provided. You will not use all of the terms.
Column I
6. market in which households purchase the goods and services that
firms produce
7. an expectation that encourages people to behave in a certain way
8. power of consumers to decide what gets produced
9. market in which firms purchase the factors of production from
households
10. financial gain made in a tansacton
11. concentration of producive eforts of individuals and firms on a
limited nIber of activities
12. a arrangement that allows for exchange among buyers and sellers
Guide. d Reading and Review
Column II
a. profit
h. competition
c. product market
d. market
e. incentive
f. self-interest
g. specialization
h. factor market
i. consumer sovereignty
Chapter 2 21 1
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Centrally Planned Economies
A. As You Read
As you read Section 3, supply the missing information in the chart below.
Central Economic Planning in the Former Soviet Union
DATE
1. Main goal: ,,ggg,gg
2. Role of central goverment:
(a) mmg g
(b) m~=mm==m======mm
3. Effects on agriculture:
(a) Positive m
(b) Negative gggmgg &
4. Efects on industry:
(a) Positve g @
(b) Negative m mggm &
5. Effects on consumers:
(a) Positive ,gm,g=ggg@
(b) Negative = mg&
Defne the following terms.
6. socialism m=
7. communism gm=gg m
8. authoritarian g
9. collective ,,
10. heavy industry mgg @
( 2 Chapter 2 . Guided Reading and Review
NAME m -=-=-- CLSS m a DATE m
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Modern Economies
A. As You Read
As you read Section 4, fill in two supporting facts or details uder each main idea by answering
each question.
Man Idea: Goverment intervenes in market economies because some needs and wants of mod
ern societies are hard to answer in the marketplace or may be answered more fairy for all mem
bers of society with goverent involvement.
1. What needs and wants are hard to answer? @@@@@@@@@@@@@@
2. What needs and wants are answered more fairly with government involvement? '
Man Idea: Goverent intervention dominates in some mixed economies.
3. How does goverment intervene in North Korea's economy? @@@@@@@@@@@
4. How is government intervention less extreme in Chia's economy?
Main Idea: The market system dominates in some mixed economies.
5. Where is the world's frest market located? @@@@@@@@@@@@@@@@@
6. Why is'it one of the freest? .....@@@@@@@@@@@@@@@@a
B Reviewing Key Terms
7. How does free enterprise difer from laissez (ire? @@@@@@@@@@@@@@@
8. Why is China said to have a transition eC(lomy? @@@@@@@@@@@@@@
_
9. What does it mean to privatize an industry? @@@@@@@@@@@@@@@@
_
10. Why do the world's national economies fall nside a continuum? @@@@ @@@@
NAME @@@@=@@@@@@@ css @@@@ DATE =@=
Benefits of Free Enterprise
A. As You Read
As you read Section 1, supply the missing information about the American market system in the
spaces provided.
Free Enterprise
Basic principles:
1.
2.
3.
4.
5.
6.
7.
Consumer
Basic Roles:
8.
9.
Government
Basic Roles:
10.
11.
12.
13.
B. Reviewing Kev Terms
Complete each sentence by writg the correct key term in the blank.
14. When individuals decide to put their house up for sale, they are exercising their
15. Farmers who feel they need a private organization to influence public policy in their behalf
might form alan @@@@@@
16. Nutritional values printed on candy wrappers or milk cartons are required under
17. Te concerns of the public as a whole make up the @= @@
( 24 Chaper 3 GuidedReading and Review
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Promoting Growth and Stability
A. As YOIJRead
As you read Section 2, supply the requested information i the spaces provided.
1. Usual length of the business cycle: gg
2. Three main outcomes of public policy aimed at economic stability:
3. Requirement for raising living standards for new generations: _
4. Two indicators of economic stability: __g__
5. Governent-provided incentives for innovation: @@
6. macroeconomics gg
7. microeconomics g
8. business cycle a
9. gross domestic product @@
10. technology _a
Guided Reading and Review Chaper 3 251
NAME ggggggg css ~~ DATE @@@
Providing Public Goods
A. As You Read
As you read Section 3, fill in two supporting facts or details under each main idea by answering
each question.
Ma Idea: I some situations, the free market does not efficiently distribute resources.
1. What is an example of something that self-interest would not motivate consumers to provide?
2. Why might this public good be unreasonable to expect from private providers?
Min Idea: Cost is an important factor in determining whether a good or service is produced as
a public good.
3. How does this facor relate to te individual? @@@@@@@@@@g@@
4. How does this factor relate to society? @@@@@@@@@@@
Ma Idea: A good or service can generate positive or negative side efects for people who do not
pay for or produce tem.
5. What is an example of a positive side efect? @@@@@@@@g@@@@
6. What i an example of a negative side effect? @@@@@@@@@
Match the definitions in Column I with the terms in Column I. Write the letter ofle correct
answer in the blank provided.
Column I
7. shared goo" d or service for which it would be impractcal to make
consumers pay individually and to exclude nonpayers
8. situation in which the free market does not distribute resources
effciently
9. part of the economy that involves the transactions of the government
10. part of the economy involving transactions of individuals and
businesses
11. economic side effect of a good or service that generates unintended
benefits or costs to someone other than the person deciding how much
to produce or consume
12. someone who would not choose to pay for a certai good or service,
but who can still reap the benefits of it anyway if it is a public good
( 2 Chapter 3
Column II
a. exterality
b. public sector
c. market failure
d. public good
e. free rider
f. private sector
Guided Reading and Review
NAME gmm=mmmmmm CLSS gmmmm DATE mm _@
Providing a Safet Net
A. As You Read
As you read Section 4, supply the missing information in the chart below.
Program or Program Area
1. TANF
2. Soci al Security
3.
4. Worker's Compensation
5.
6. Education
B. Reviewing Key Terms.
Form of Aid
Health insurance
Recipients
Workers who are lai d of or lose
their jobs
Rewrite each statement below to make it agree with the italicized key term.
7. The most common in-kind benefits include food giveaways, food stamps, subsidied hous-
ing, and farm aid. mggggmgg_gggg
8. The government institutes welfare programs to improve transportaton routes. mm@__
9. A nation's stndard of living indicates itslevel of income distribution. gmm
10. The povert threshold is the income level below that which is needed to provide the needs
and wants of families or households. gggggggggg
Guided Reading and Review Chapter 3 271
NAME mmmmmmm css m==wm DATE mmm w
Understanding Demand
A As You Read
As you read Section 1, for each boxed example, fill in the key term the example ilustrates in the
space provided.
1. the higher the price of
pizza, the fewer slices
people will buy
4. Price
1
2
3
4
2. eating salad or tacos
instead of pizza when the
price of pizza goes up
Quantity 5. Price
5 1
4 2
3 3
2 4
Complete each sentence by writing the correct ter in the blan.
3. buying fewer slices of
pizza when rising prices
reduc
e
real income
Quantity
300
250
200
150
6. A is a table that lists the quantities of a good a person will buy at
. each price that may be offered in the market.
7. A is a table that lists the quantities of a good demanded by all con-
sumers at each price that may be offered in the market.
8. A is a graphical representation of a demand schedule.
9. The is the change in consumption resulting from a change ilreal
income.
10. The says that when a good's price is lower, consuers will buy
more of it.
NAME CLSS DATE
Shi fs of the Demand Cure
A. As You Read
As you read Section 2, answer the following questions in the space provided.
1. Wat condition must exist to make a demand curve accurate? @
2. Wht happens to a demand curve when there is a change in factors (other tn price) that
can affect conswners' decisions about purchasing the good? @@
3. How does conswner income affect the demand for normal and inferior goods? @ @
4. How does consumer expetation afect demand for certain goods? @
5. Explain how the baby boom generation affected demand for <ertain goods.
6. How are consumer tastes and advertising related?
7. Explain how demand for a good can afect demand for a related good. @@
8. Give an example of a substitute good. @
Match the definitions in Column I with the terms in Column II. Write the letter of the correct
Column I
9. all other things held constant
10. goods whose demand increases as consumer income increases
11. goods whose demand falls as conswner income increases
12. goods that are bought and used together
13. goods that are used in place of one another
Column II
a. normal goods
b. substitutes
c. ceteris paribus
d. inferior goods
e. 'complements
Chaper 4 2 I
NAME gg css ~~ DATE g~ ~
Section 3: Guided Reading and Review'
Elasticity of Demand
A. As You Read
As you read Section 3, supply the missing information in the spaces provided.
Calculating Elasticity (Provide a formula or numerical value.)
1. Computation of elasticity of demand: gg, &
2. Elastic demand: ~ggg-,
3. Inelastic demand: ggg-g&
4. Unitary elastic demand: _ ~
Factors Mectng Elastcity (How does each afect elasticity?)
5. Substitutes:
6. Necessities vs. luxuries: ggg
7. Changes over time: ggggg
Elasticity ad Revenue (Define and explai.)
8. Total revenue: g~~~g~g
9. How elasticity affects a company's pricing: g
I Reviewi"g Key Terms
Briefly define or identif each of the followig.
10. elasticity of demand g ~
11. inelastic ~~
12. elastic gggggggg~~ &
13. unitary elastic ~g~
NAME mmmmmmmmmmmm~m css mmmm DATE
Understanding Supply
A. As You Read
As you read Section 1, supply the missing causes or effects on the lines provided in the chart.
Cause Efect
1. The price of pi
za increases.
2. The cost of tomato sauce increases along with
the price of pizza.
3. mm
4. m
5. The supply of a good is not very responsive to
price changes.
6. A supplier, such as an orange grower, has a
long time to respond to a price change.
1. On pizerias:
2. On pizza supply schedule:
3. On market supply curve: Prices will remain the
same as on a single pizzeria'S supply curve.
4. On supply curve: The curve always rises fom
left to right.
5. On the value of elasticity of supply:
6. On supply:
Read the statements below. In the space provided, write T if the statement is true or F if it is false.
7. Price and quantity supplied are variables on a supply schedule.
S. A supply curve shows price and quantity in a table.
9. Elasticity of supply states that the output of a good increases as the price of the good
increases.
10. To create a market supply schedule, an economist needs to know the total output of
all suppliers in a given market.
Guided Reading and Review Chaper 5 31 1
NAME gmg m wwwwgwwm = css mwmmw =
Costs of Production
A. As You Read
As you read Section 2, supply the requested information in the spaces provided.
DATE wm
1. A basic question a producer must answer: gppmggmpmpgmpmwg
2. Marginal product of labor benefits gained from worker specialization: gpgpggg
3. Negative effect of a firm's limited capital: gwmgmppgpmgmppm
4. Curve pattern for marginal product of labor when capital is limited: gggmgm
5. Examples of typical fixed costs: ggmmgmggmgm~g
6. Why labor is a variable cost: gggmmgmwpgg~pgppmg
7. How the margial costs of production for the beanbag producer changed after the rate of
three bags per hour was surpassed
:
gpwg ggmpgggmpmwg=
8. How total revenue and total cost can help set the most profitable output level:
9. How marginal revenue and marginal cost can help set the most profitable output level:
10. Why a producer would continue to increase output even tough the marginal cost of pro-
duction may be rising: ggwgggg gp mgmgmggg
Define the following terms.
11. marginal product of labor gpggmggmgmwpmpmpmgpmp
12. diminishing marginal returns ggggggpmpmgggmpggggg
13. total cost gggpgp~mgmpgpgpggggwgggpgg
14. marginal cost ggggggggggggggggggmggggggmm
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Changes in Supply
A. As You Read
As you read Section 3, supply information to complete each statement in the spaces provided.
1. Unable to contol price, a prftble producer fce wit rising labor andor materials costs wl
2. New technolog affects supply by
3. European goverents' reasons for subsidizing food producers include
4. I the past, Wester European goverments subsidized banks and airline by
5. The United States goverment subsidizes such industries as
6. A excise tax increases production costs by
7. Consumers may be unaware of excise taxes because
8. Governent regulations often reduce supply because
9. During periods of infation, suppliers may temporarily withhold goods that can be stored
for long periods because
.
Complete each sentence by writig the correct key term in the blank provided.
10. Government can increase supply by grantig producers a(n) @mmmmmm
11. To reduce supply, a goverent might levy a(n) @mmmmmm
12. Requiring pollution control on automobiles exemplifies goverment
Guided Reading and Review Chapter 5 3l
NAME @@@@wm_ CLSS =g= DATE pP-m~w
Combining Supply and Demand
A. As Vou Read
In the Case of the Pizzerias
1. The market equilibrium price: m mm@@
2. The market supply level: @@@ = @_=@@@w@ _
3. The market demand level: _. _q@m q@
m~_
I Any Market Environment
4. How equilibrium is shown on a supply and demand graph: _@ mq_
5. Two possible outcomes of disequilibrium: _ mq@@ =@@
6. Supplier price response to excess demand: @@
7. Condition under which market forces will push market towatd the equilibrium: @ _
In the Case of Goverment Intervention
8. Purpose(s) of rent control: _, @q@@=@@ _
9. Negative results of ending rent control: @m@@@@@@
10. Effect on labor when minimum wage exceeds equilibrium: m@= _
11. Purpose of Northeast Dairy Compact: m@m@_
Complee each sentence by writing the correct term i the blank provided.
12. When goverment wants to ensure that "essential" goods o services are within .the reach
of all consumers, it may impose a(n) m@@ _
13. If prices rise too high, a market may face the problem of p@@ @
14. The one and only price at which quantities supplied equal quantities demanded indicates
the market mm
15. Miimum wage is an example of a government-imposed
~mw@@
16. If car manufacturers produce more or fewer cars than customers will buy, the car market
will be in _=@m
css mmmmmm DATE =mmm
Changes in Market Equi librium
A. As You Read
As you read Section 2, complete the chart by supplying an effect for each cause.
Cause Efect
1. Entire supply curve shifts. 1.
2. Technology for making compact disc (CD) 2.
players improved.
3. After a drop in production cost, CD player 3.
suppliers become willing to offer 1,200,000
units at the original price, but demand remains
at 1,000,000.
4. Price of CD players continues to fall. 4.
5. Production cost of CD players continues to 5.
fall.
6. Market's supply curve shifs to the left. 6. In the market:
On the equilibrium point:
7. Demand curve of a good suddenly shifts right.
8. Signs of excess demand for the good continue
over time.
9. Demand for a good falls.

7.
8. On suppliers:
9. On the demand curve:

Rewrite each sentence so that the italicized ter is used correctly.
10. Shortage occurs when the quantity demanded falls below the quantity supplied.

@'
11. Excess demand for a good indicates a market surplus of that good.
12. Suppliers pay search costs in the form of financial and opportunity costs as they search for
a good.
Guided Reading and Review Chapter 6 35 )
NAME @@~~ m~ @ css- DATE w
The Role of Prices
A. As You Read
As you read Section 3, answer the questions on the lines provided.
1. Wat overall, vital role do prices play in te fee market? @ @@@@@@@@ @
2. What standard do prices set? @@@@@@,@@@@@@@@@@@@@ &
3. What sigals do high prices send to producers and consumers? @@@@@@@@&
4. Why do suppliers use price rather than production to resolve the problem of excess
demand? @@@@@@@@@@@@@@@@@@@@@@@@ @@
5. What drives the distribution system i the fee market? @@~@@@ @
6. How does a price-driven economy allow for a wide diversity of goods? @p @
7. What was the goal of the Soviet planned economy? @,@@,@@@@@@&
8. How did the Soviet economic system affect consumer goods? @@p
9. How does the fee market ensure an effcient allocation of resources? @@@@@
10. What motivates suppliers to increase production in the face of high demand and high
prices? @@@@@@@@@@@@@@@@@ @
11. What three problems i the free market work against the efficient allocation of resources?
Y
12. suppshock---------@
13. rationing @@@@@@@@@@@@@,@~@~@@@@&
14. spillover costs @@@@@@@@@@@@@@@@@@@
@@@ @
NAME m@@@@~@@@@@@@ css m@@@@@ DATE m@@
Perect Competition
A. As You Read
As you read Section 1, supply the missing cause or efect i the spaces provided.
The Perfect Market Structure
1.Cause: @@_,_m@@@@@
2. Cause: mmmmmmmmm~_
3. Cause: Entrepreneurs are less likely to enter a
market with high start-up costs.
4. Cause: Sometimes firms cannot make enough
to stay in business.
5. Cause: @@@@@@@@mmmm
6.Cause: m@@@@@@@@@@m@ @
B. Reviewing Key Tems
Briefly defne or identif each of te following.
1. Efect: The market determines price without
influence from suppliers or consumers.
2. Efect: Identical products are key to perfect
competition.
3. Efect: @@@@@@@@@@@@@-
4.Efect: @@@@@@@@@@@
5. Efet: 'Prices are forced down to the point
where they just cover te seller's costs of doing
business.
6. Efec: Producers adjust their outut deisions
based on their most efficient use of available
land, labor, and capital.
7. perfect competition @@@@@@@mmmm,_mmmmmm@@@@@
8. commorty mmmmmmmmm@@@@@@mmmmmmmmmm@
9. barrier to entry mmmmmmmmm@m@mmmmmmmmmmmm@@
10. start-up costs mm@mmmmmmmm@@@@@@@@@mmmmmm
Guided Reading and Review Chaper 1 37 '
NAME @g@g@m m css g
Section 2: Guided Reading .and Review
Monopoly
A. As You Read
In the Monopolist Market
Natural Monopolies
1.. Wy they exist m@g@g
Goverent Monopolies
5. Type set up by patents
DATE @gmm
2. Two examples @m @gmg 6. Why government grants patented monopolies
3. Advantage of @@@~@~ 7. Example of an industrial monopoly
4. Government role in g@g@@g@g 8. Two example of goverent monopoles by liense
Production and Pricing
9. Effect of a monopolist's price ip.crease
10. Relationship beteen price and marginal revenue when a monopolist cuts the price to sell more
11. How a monopolist maximizes profits
Complete each sentence by writing the correct key term in the blank.
12. In a market with only one seller, that seller has a mg@@m
13. Characteristics that cause a producer's average cost to drop as production rises are
14. A contract issued by a local authority that gives a single firm the rght to sell its goods
within an exclusiye market is a m@g@@
15. A monopoly offering targeted discounts is practicing @@@@
d
.
{

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Monopolistic Competition and Oligopoly
A. As You Read
As you read Section 3, fill in the information requested on the charts .
. Monopolistic Competition Market Structures
Defining
1 2.
Conditions
3. 4.
Forms of
5. 6.
Nonprice
Competition 7. 8.
Price-Output
9.
Relationship
Curbs on
10. 11.
High Profits
Consumer
12.
Advantages
Oligopoly
Conditions
13. 14.
Encouraging
15.
Formation
Practices
16. 17.
that Concern
Goverment
18.
I
I B. Reviewing Key Terms
0
i
Read the statements below. In the space provided, wite T if the statement is true or F i it is false.
@
19. Firms selling identical products create monopolistic competition.
20. Providing better customer service, introducing a new lipstick color, and sophisticated
advertising are examples of nonprice competition.
21. Price fiing is an outcome of collusion.
22. A crtel is most successfl when each member produces as much product as possible.
NAME gggggg CLSS ggg DATE q gm
Regulation and Deregulation
A. As You Read
As you read Section 4, supply the missing information about government market intervention in
the numbered web boxes.
1.
Goal
6. 2.
Recently Deregulated Industries Antitrust Powers
5. 3.
Guidelines for Mergers Complaints Against Microsoft
4.
Complaints Against AT&T
Use a key term to rewrite each sentence correcty.
7. Price fixing is the practice of setting the market price below cost for the short term to drive
competitors out of business. ggggggggggggm
8. A monopoly occurs when a company joins with another -ompany to form a single firm.
9. Perfect competition means that the goverent no longer decides a company's market role
and pricing. gggggggggggmgggg
( 4 Chaptr 7 Guided Reading and Review
NAME ' CLSS qqqqq DATE mmmmm
Sole Proprietorships
A. As You Read
As you read Section 1, supply the missing information i the spaces provided.
Sole Proprietorships
1. Owned and managed by: @mmmmmmmmmmmmmmmmmmmm
2. Percentage of U.S. businesses: @mmmmmmmmmmmmmmmmmm@
3. Percentages of U.S. sales generated: @mmmmmmmmmmmmmmmmm@
List and explain the advantages of sole proprietorships.
4. mmmmmmmmmmmmmmmmmmmmmmqqqqqqq
5. mmmmmmmmmmmmmmmmmmmmmmmmmmmmm
6. mmmmmm&&&&&&&&&&&&&&&&&&&&&
7. @mmmmmmmmmmmmmmmmmmmmmmmmmmmmmm&
8. @mmmmmmmmmmmmmmmmmmmmm mmmmmmmm&
List and explain the disadvantages of sole proprietorships.
9. @mmmggggggggggggggggg
10. mmmmmmmmmmmmmmmmmmmmmmmmmmmmm
11.
Find the term that does not belong in each set and explain how it does not relate to the other
three.
12. (business license, certificate of occupancy, business organization, registration of business
name)
"
13. (liabilit, health codes, zoning laws, dangerous chemical codes)
14. (human capital, fringe benefits, physical capital, financial resources)
Guided Reading and Review Chapter 8 41 )
NAME w~= wW W CLSS WmmW DATE mm
Section . Guided Reading and Review
Parnerships ,
A. As You Read
1. Tyical examples of a general partnership 1. mmm m@@
2. What limited partners Co and do not do 2. @@mWm+
3. How limited liability partnerships compare with 3. @@@@
general partnerships
4. Items often covered under articles of partnership 4. p
5. Capital and taxation advantages of partnerships 5. m=@@WW +
6. Liability disadvantages of partnerships 6. @W=mw
7. Only one partner is required to be a general partner in a @p@@
8. Money and other valuables make u
p
a
p
erson's or firm's mm_
9. Ownership interests and management responsibilities are legislated under the

| 4t Chaptr 8
NAME mmmmmmm css ~~~~ DATE ~
Secti on 3: Gui ded Readi ng and Review
Corporati ons, Mergers, and Multi nati onal s
A. As You Read
A you read Section 3, supply the missing information in the graphic organizer.
1. Corporate Structure
6. Regulator Requirements 2. Advantages for Stockholders
I
7. Possible Combinations
Incorporation
3. Advantages for Businesses
I
4. Start-up Procedure
5. Taxation
Read the statements below. In the space provided, write T i the statement is tue, or F i it
is false.
8. Companes in the same business might form vertical mergers.
9. Multinational corporations usually headquarer in several countries.
10. I you buy stocks, you own part of a cororation.
11. Corporate bonds pay dividends.
12. Corporations have a legal identity.
13. Dividends represent a portion of corporate profits.
14. Privately held corporations are also closely held corporations.
\
15. The federal government issues a company's certificate of incorporation.
16. A conglomerate merges more than three companies making unrelated products.
17. Publicly held corporations sell stocks to the Securities and Exchange Commission.
18. Stockholders must pay a capital gains tax whenever they sell their shares.
Guided Reading and Review Chaper 8 4l
NAME Ww= ~WWWWWWW CLSS wm DATE =mW
Section 9' Guided Reading and Review
Other Organizations
A. As You Read
A you read Secion 4, supply the missing informaton under the headings on the chart.
Business Franchises
Cooperative Organizations
Nonprofit Organizations
Advantages
1.
Membership and/or Purpose
3.
5.
Briefly defne or identify each of the following.
Disadvantages
2
Categories
4.
6.
7. royaties WgmmW@@==wmW@=~WwwW
8. trade association =WgW=w@wWw==~@w@=Ww
9. cooperative =Ww@=@w@@@w=@m=mm __
|4 Chapr 8 Guided Reading and Review
NAME wwwwwwwmmwwmmmmm css ww DATE mmmmq
Section 1 : Guided Reading and Review
Labor Market Trends
A. As You Read
A you read Section 1, fill in two supporting facts or details under each mai idea by ansering
ech question.
Main Idea: The Bureau of Labor Statistics (BLS) tracks changes in the labor force.
1. How do economists define labor force? qqqqqqqq
2. What criteria defie unemployent? @qq
Main Idea: The changing economy has brought along a changing job market.
3. How did the eletronics boom of the md-twentiet century impact the job market?
4. What new jobs were created beginning in the 1970s? qqqq
Main Idea: Changes in the labor force can be traced to a number of causes.
S. How has higher education contributed? @qqqqqqqq
6. Why are there more women i the labor force?
Main Idea: For about the past 20 years, the trend in average wage earings can be described as
slightly downward.
7. Have all workers received lower wages? qqqqqqqqqq
8. How has competition affected wage eaings? q -qqqm
Answer eac of the following questions in a complete sentence;
9. How might the learing efect influence wage tends? @qqqqq
10. Accordig to the screening efect, how may employers view job applicants who have a col-
lege education?
11. To what kinds of jobs doe contingent employment refer? qqq
NAME _ wmWwmw css DATE w
Labor and Wages
A. As You Read
As you read Section 2, complete each of the following sentences.
1. Employment in a labor market depends on how closely the demand for workers meets
2. The price of labor (earings) depends on _@
3. Professional labor requires
4. In a competitive market, workers are usually paid according to m
@ @
5. Higher labor prices decrease the @w
6. Firms can respond to higher wages by replacing _m m
7. Higher wages increase the @m
8. Jobs in the skilled labor category require _
9. A high equilibrium wage is the result of @m
10. The Equal Pay Act of 1963 provided that
i 1. Title VII of the 1964 Civil Rights Act forbids job discrimination on the basis of
12. Lack of human capital and possible discrimination contribute to low wages for
13. Negatve efects on nonunion wages can be reduced when' unions mwm
W
14. labor force
15. equilibriu wage @m_mmW

16. glass ceiling m_gmm@m@mmgm
17. featherbedding m mmmm_wmmm
4 Chapr 9 Guided Reading and Review
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Sction 3: Guided Reading and Review
Organi zed Labor
A. As You Read
As you read Section 3, supply the information requested by the heading in each box.
Major U.S. labor organizations
formed between 189 and 1955:
1. (1 869) @gggaaaa
2. (1 886) @gggaaa
3. (1938) aaaaggm
4. (1 955) @ggaaa
Anti-union strategies used by
U.S. employers before the 19:
5. mmmmmmmmmmm m
6. mmmmmmmmm@
7. mmmmmmmmmmmm
8. aaaaaaaa@g
Economic changes tat have
afected unions:
9. mmmmmmmmm,
10. maaa,,,,,,,m
11. maaggg@am
Ways in which unions have
declined in traditional strongholds:
12. a,,,,,mmmmm
13. a=,,,,,,,,m
14. a,,aaaammmm
15.
@@@@
Major issues covered
under a union contract
16. a,mmm==m,,mm
17. a,gggaaaa,,
18. ammmmm,,mmmm
Match the definitions in Column I with the terms in Colun II. Write the letter of the correct
answer in the blank provided. You will not use all of the terms.
Column I
Column II
19. union and company representatives meeting to negotiate a contract a. arbitration
20. worker in a professional job receiving a salary b. stike
21. measure banning mandatory uion membership c. blue-collar worker
22. worker in an industrial job d . + collective bargaining
23. settlement technique using third party reviews e. white-collar worker
24. organized work stoppage f. mediation
g. right-to-work law
Guided Reading and Re.view Chapter 9 47 )
NAME =~WW~WWW CLSS mm
Money
A. As You Read
Describe the three uses of money.
DATE W
1. =m=m^^^-=^^^ W
2. mW~ WWW~W~WWWwW
3. WWw~~~~w
Define the six characteristics of money.
4. Ww
5. m~~@@q~@qwWWqm
6. . =^ =
7. W^^^^W=~^
8. WWWW^
9. W~W~q~-ww@@w~
Match the definitions in Column I with the terms i Column n. Write the letter of the cor
r
ect
answer i the blank provided.
Column I
10. something that keeps its value i held
11. objects that have value because the holder can exchange them for
something else of value
12. money that has value because the goverment says it is acceptable
for paying debts
13. anything that is used to determine value during the exchange of
goods and services
14. exchange of one set of goods or services for another
15. coins and paper bills used as money
16. way to compare te value of goods and services relative to each
other
17. anyhng used as a medium of exchage, a unit of account, and a
store of value
18. objects that have value in themselves as well as for their use as money
( 4 Chaptr 10
Column II
a. barter
b. store of value
c. fiat money
d. currency
e. money
f. medium of exchange
g. commod
i
ty money
h. unit of account
i. representative money
NAME @@@@@@@@@@@@@@@ css @wwwww DATE @ @@w
The Hi story of Ameri can Banking
A. As You Read
each question.
Main Idea: Before the Civil War, banking in the United States shifted between a centralized sys
tem and independent state and local banks.
1. What were the first two attempts to centralize U.S. banking, and when were they in
operation? @_@@@@@@@@@@@@@
2. What problems were associated with the Free Banking Era (1837-1863), dominated by
state-chartered banks? @@@@@@@@@
Main Idea: Reforms of the late 1800s stabilized the bankig system.
3. How did the National Banking Acts of 1863 and 1864 promote stability? @@@@
4. How did the gold standard promote stability? @@@@
Main Idea: Banking reforms early in the twentieth century helped strengthen and centralize
American banking.
5. How did the Federal Reserve System, established in 1913, begin to manage the money
supp
6. What guarantee was made available to bank customers in 1933? @@@@@@

Complete each sentence by writing the correct term in the blank provided.
7. One advantage of the was that the goverent could only issue
currency i it had gold in te treasury to back it.
8. The was a paper currency printed with geen i that was issued
by the U.S. Treasury during the Civil War but not backed by gold or silver.
9. A(n) receives, keeps, and lends money.
10. The nation's central banking system is the
NAME ~wWm~m~ CLSS DATE ~mg
Section o. Guided Reading and Review
Banking Today
A. As You Read
As you read Section 3, supply the requested information on the lines provided.
Define Ml.
1. ~~- W-
Define M2.
2. mw
List five services that banks offer.
3. g@@ @m__ ,
4. @. @~q~~~~~~@~W
5. m~~mgwm~qgwWg~~~mwW~
6.
7. w~~ ~=~m. W~~@@w~~~
Describe four tYes of financial institutions.
8. ~m,m* !~w~
9. W~mW~m
10. WWq,
11. m=- W~mW~~_W@~m~m
12. money supply wggm
13. liquidity Wgmgmmgwg
14. demand deposit mmmqg~WwW
15. money market mutual fund @ggw~qg~mW
16. fractional reserve banking @ggmgm~_
17. default @gg@mwmmwwmm
18. mortgage wm mmwg
19. credit card
20. interest wmggggwmmw
21. debit card wmgggmgmg
22. creditor gmgmwmwmggmm
| 5 Chaptr 10 Guided Reading and Review
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NAME @ammaeemmmmmeee CLSS aaa=== DATE mmme=
Saving and I nvesting
A. As You Read
As you read Section 1, supply the missing information about the functons of the fmancial inter
mediaries in the chart below.
Fi nanci al I ntermedi ari es Functions
1. Banks, Savings and Loan 1.
Associations, Credit Unions
2. Finance Compani es 2.
3. Mutual Funds 3.
4. Life I nsurance Compani es 4.
5. Pensi on Funds 5.

Complete each sentence by writing the correct key term in the blank provided.
6. Before puttmg money into mutual fnds, a potential investor can review the fund's perfor-
mance in its mmm@

7. The use of assets to ear income or profit constitutes a(n)
@
8. To transfer money between savers and borrowers, allowing investment to take place, an
economy needs a(n) e@@ m m
9. Securities is another name for @mmmm@e
10. The lower the risk in an investment, the lower its @m@ea
11. The collecion of all one's financial assets makes up one's m@@@@
NAME w~wwww CLSS DATE ~mw~
Bonds and Other Financial Assets
As You Read
As you read Section 2, answer the questions on the lines provided.
1. How does an investor earn money by buying bonds at a discount? w~ ~
2. What are Standard & Poor's and Moody's ratings based on? wmg
3. What advantages do bonds offer to firins that issue them? g@mm
4. What disadvantage do bonds present for the issuer? m~~~@
5. (a) What types of government bonds are available to investors? ~wwwg
b)Which type offers the greatest tax advantage? =@@w~~~
6. What three organizations help ensure value and prevent dishonesty in the bond market?
7. (a) What i the investment advantge of money market mutual funds over CDs and savings
accounts?
b)What is the disadvantage? gqwm~@.~@www+
8. (a) In financial asset markets, how o capital markets differ from money markets? ~w
b)How do primary markets differ from secondary markets? .
Define' the following terms.
9. maturity g~@q~@~m~~~mm~~m~~~
10. corporate bond .w~~mmq~@w +
11. junk bond ,-wwww~ ~m~g
12. coupon rate gq~w~@@~m~~m~~~q~=
|5t Chapter 11 Guided Reading and Review
NAME mmmmmmmmmmmmmmm m css mm DATE-
The Stock Market
A. As You Read
As you read Section 3, supply the missing information to complete each sentence in the spaces
provided.
1. Income stocks pay @@@@@
2. Growth stocks can be profitable because they -- @@
3. Investors experience capital gains when they __ @@@
4. Investors suffer capital losses when they @@
5. Stocks are rskier than bonds because
6, Blue chip stocks are traded on. the
7. A put option is the option to
8. During a bear market, investors sell because
Match the descriptions in Column I with the terms in Column n. Write the letter of the correct
answer in the blank provided. You will not use all the ters.
Column I
9. steady, extended rise in stock market
10. electonic marketlace for stock not listed on an
organzed exchange
11. claims of ownership in a corporation
12. making hig-risk investments with borroed money
in the hope of getting a big return
13. market for buying and seling stock
_ 14. person who links buyers and sellers of stocks
_ 15. 1929 colapse of the stoc market
16. business specializing in trading stocks
17. contracts to trade stock at a specific price and
time in the future
Column II
a. stockbroker
h. options
c. bear market
d. Great Crash
e. brokerage firm
f. bull market
g. equities
h. OTC market
o speculation
j. stock exchange
Chaper 11 5 )
NAME ~~~~~~~~~~ = CLSS ~~ DATE ~g~~~
Gross Domestic Product
A. As You Read
As you read Section 1, answer the following questions about gross domestic product.
1. Wat is the gross domestic product? ggggggg _
2. How is the expenditure "pproach used to calculate it? ggg
3. How is the income approach used to calculate it? gggggg~
4. What is the difference between nominal GDP and real GDP? gg~~mg=
Describe four limitations of using GDP to measure economic growth:
5. ~mm_
6. ~=mmmm=
7. mm
8. ~=m~=~~~~ ~~~~~~=
9. How is the gross national product derived from the gross domestic product? g
10. How is GDP related to aggregate supply and aggregate demand? g~gggmg
Match the descriptions in Column I with the terms in Column II. Write the letter of the correct
answer in the blank provided. You will not use all the terms.
Column I
11. a system that collects macroeconomic statistic on production,
.
income, investment, and savings
12. goods used in the production of final goods
13. GDP measured in current prices
14. goods that last a short period of time
15. GDP expressed in constant, or unchanging, prices
16. goods that last for a relatively long time
17. loss of the value of capital equipment that results from normal
wear and tear
18. the total amount of goods and services in the economy available at
all possible price levels
19. the average of all prices in the economy
20. the annual income eared by U.S.-owned firms and U.S. residents
21. the dolar value of all final goods and services produced within a
country's borders in a given year
( 5 Chapr 12
Column II
a. real GDP
h. nominal GDP
c. aggregate supply
d. nondurable goods
e. price level
f. intermediate goods
g. depreiation
h. national income
accounting
i. gross domestic product
j. durable goods
k. gross national product
1. aggregate demand
NAME _a&aaaamama& css a=== DATE
A. As You Read
Busi ness Cycl es
As you read Section 2, fil in each item in the following diagram.
Phases Contributing Factors Cycle Indicators
1. _&aamaa 5. ma&a&m& 9. _a&a aa&
2.
6. @a&a&aa 10. _ma&aa& &

3. _a&aama 7. _maaaam& 1 1 . @a&a&ma&
4. _a&a&ma 8. &aamaa
. Define the following terms.
12. business cycle aaaaaaaaa&aaaa&aaaaaaa&a
13. expansion aaaaaa&aaaama&aamaaaaaaa
14. economic growth _amaaaamama a&aaaaaaaaa
15. peak =m=aa&ma=a&a&mamaaaaaaaaaa
16. contraction _&aaa
mmmmmmmmmmmmmmmmmmm
17. troug _aa&aaaa&aa &mamaaaa&aaaaa
18. recession _&aaa&m&mama&amaaaamaaaaaam
19. depression
20. agflation _aaaaaa&aaaaaamaaa&aaama
21. leading indicators aaaa&aaaaaaaaaaa=aaaam
NAME @=@--@=m=- @mmm css m~mW~~
Section 3: Guided. Reading and Review
Economic Growh
A. As You Read
DATE m=m=W
As you read Section 3, fill in supporting facts or details under each main idea by answering
each queston.
Ma Idea: Capital deepening is an important source of growth
in modem economies.
1. . How does capital deepening increase output per worker? @@@
2. How is human capital deepened? @@@ @m@mm@@@m
M Idea: The rate of saving and investent afects the economy.
3. What happens when saving rises? _@@@@@@@
4. How does increased investment help the economy? g@@
Ma Idea: Population, goverment, and trade all directly affect the economy.
5. What happens when population grows and capital remains constant? @@mm
6. How do government taxation for consumption spending and importing goods for short-
term consumption affect economic growt? @@m@_@@@
Ma Idea: Technological progress is a key source of economic growth.
7. How do economists measure the ipact of technological progress on economic growth?
8. How does the government aid technological innovation? @gm@@ @
9. is the proportion of disposable income spent to income saved.
10. The real GDP divided by the total population is called m@ _=
11. Increasing the amount of capital per worker is @
12. Income not used for consumption is considered @
13. A increase in effciency gained by producing more output without using more inputs is
called _ _~m
( 5 Chaper 12 Guided Reading and Review
NAME m@@@~@@@@@@@@@ css @..... DATE m@@@@
Unemployment
A. As You Read
As you read Section 1, supply the missing reason for or tp of unemployment on the lines pro
vided in the chart.
Reason for Unempl oyment Type of Unempl oyment
1. people taking time lookng for work after finishing school 1.
2. 2. structural unemployment
3. lack of education or training for skills in demand 3.
4. 4. frictional unemployment
5. a healthy economy that i s working properly 5.
6. 6. seasonal unemployment
7. 7. very low unemployment
8. 8. strucural unemployment
9. development of new technologies 9.
10. 10. cyclical unemployment
11. 1. structural unemployment
B. Reviewing Kev Terms
Complete each sentence by writing the corect term in the blank provided.
12. My cousin Harold is used to , since he works for a landscaping
company and is laid of every winter.
13. I is easy to find a job these days, since the @@is so low.
14. People who do not finish high school often suffer fom m@@@@mmm
15. With g nearly everyone who wants a job has a job.
16. The excellent mechanic who has been working as a clerk at a convenience store since the
local garage closed is considered @@@@@@@
17. My aunt who left her job to care for her sick mother and i now looking fr work is an
example of m@@@@@@
Guided Reading and Review Chaper 13 57 J
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Secti on 2: Gui ded Readi ng and Review
I nfl ati on -
A. As You Read
As you read Section 2, answer the following questions.
1. What would you use to see how prices have changed over time? qqqqqqqq
2. What does the example of the Barrow's house increasing from $12,000 to $150,000 over
50 years show?
.
3. How is the Consumer Price Index (CPI) used? qqqqgqqq.qqqq
4. How does the Bureau of Labor Statistics determine the CPI? qqq@q@gqq
5. What data must you have to calculate the inflation rate for a specific year?
6. What happens when hyperinflation occurs over an extended period of time? qq@q
Describe three theories of the causes of inflation.
7. q.== ~~m~~=~~====m~~~==~~
8. ~m=mmm=m=m==m=mm=mm=m=mmm=,
9. ==mm==.m==m==m==mmmm=mmmmm
How does inflation affect each of the following?
10. purchasing power qqqqqgqqq@gqqqq@qqqq
11. fed income qqqqqqq@qqqqqqqqqqqqqq@
12. savings qqqqqqqq@qq@qqqqqqqqqqqqqqq@
13. infation rate qqqqqqq@qqq@qq@mm
14. defation qqqqqqqqqqqqqqqqqqqqqqqqq
15. Consuer Price Index qq.qqq@qqqqqqqqq@qqq =
16. inflation qq@qq@qq@qqgqq@qqq@qqqq
17. wage-price spiral qqqqgqqqqqqqqqqqq.qqqqq~
18. price index ,q.qq@qqq.q~gq~~..~~~~.q=
d
.
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NAME mm css @mmm DATE
Pover
A. As You Read
As you read Section 3, fill in two supporting facts Qr details under each main idea by answering
each questiQn.
Main Idea: The U.S. Census Bureau has develQpe measurements to calculate thenubr Qf PQQr . _
1. What cQnditiQn must exist fQr everyQne in a hQusehQld to be cQunted as PQQr?
2. What dQes the PQverty rate help us understand? @@@@
Main Idea: PQverty has a number Qf rQQt causes.
3. What dO statistics shQW abQut a lack of educatiQn contributing to PQverty? @@@
4. What has the divorce rate shQwn abQut PQverty? @@@@@@@@@@@@
Main Idea: Knowing hQW the natiQn's tQtal inCQme is distributed helps peQple understand
PQverty.
5. What percentage Qf the natiQn's total inCQme dQes the IQwest 40 percent Qf the PQPulation
receive? @@@@@@@@@@@@@@@@@@@@@@@@
6. What twO key factQrs cQntribute to the differences in income distributiQn? @@
Main Idea: The gQverment has variQus prQgrams and PQlicies to combat PQverty.
7. What prQgrams and laws help wQrking people achieve an adequate incQme? @@@
8. HQW might the welfare refQrm prQgram help reduce PQverty? @@@@@@@@
CQm
j
lete each sentence by writing the CQrrect term in the blank.
9. The is the gr
!
phed curve that illustrates income distributiQn in the
eCQnomy.
10. The progam that requires work i exchange for assistance is called @@@@
11. The is the percentage Qf peQple in a particular grQUP whO are Qff-
cially cQnsidered living in PQverty.
12. The level Qf incQme belQw which inCQme is insuficient to supPQrt a family Qr hQusehQld is
called the
NAME w~~wwww css w
Section 1: Guided Heading and Review
What Are Taxes?
A. As You Read
A you read Section 1, supply the requested information in the spaces provided.
Explain what gives the government the power to collect taxes.
DATE ~w~
1. ______________________ ==
List four ways in which the goverent's power to tax is limited.
2. @@~@~@~~w~w~w~w~~wwww
3. ww~ww~_~wwww~w~www
4. ~~
5. wwm ~w~~~wwwwww
List and define the three tyes of tax structures.
6. www+ww+wwww~~~~@ww
7. w www~ ~~~~w
8. w w~~w
List and define te characteristics of a good tax.
9. wwwmww~ww-w~~wwww-~w
10. w~~~~
11. @wwwwwww~~_mwwww~
12.
Complete each sentence by writing the correct term in the blan provided.
13. The income, property, good, or service that is subject to tax is considered a
14. The is the final burden of a tax.
15. Sales tax is a type of
tax.
16. With the percentage of income paid in taxes remains the same for
all income levels.
17. Income tax is a type of tax.
18. The income that government receives is called @wwww@
( 6 Chapr 14 Guided Reading and Revew
NAME +@@@@mm@@mm@@m css mm DATE =
Federal Taxes
A. A You Read
As you read Section 2, fill in supporting facts or details under each main idea by answering each
question.
Main Idea: Individual income taxes ate imposed on the i
n
come of all individuals living in the
cOuhtry.
1. Why do employers withold a set amount of your income? qqqqqgq
. 2. What is taxable income? qqqqqqq@qqqqqqqq@qgq
Main Idea: Federal Insurance Contributions Act (FICA) taxes fund two large government
programs .
. 3. What does Social Security provide? @gqqgqqgqqqqqqqqq
4. What is Medicare? qqqqqqqqqqqqqqqqqqqqqqqqq=
Main Idea: Taxes are sometimes used to afect behavior.
5. What items are taxed for the purpose of changing behavior? qqqqqqqqq
Match the descriptions in Column I with the terms in Column I. Write the letter of the correct
Column I
6. amounts that you can subtact from you income when filing taxes
7. form used to fle one's income taxes
8. income on which t
a
x must be paid
9. tax on a monetary g from a living person valued above a crtain amount
= 10. tax on the total value of the money and property of a person who has died
= 11. tax payments taken out of an employee's pay before he or she receives a
paycheck
.
12. tax levied on foreign goodS brought into the United States
Column II
a. taxable income
h. tarif
C. tax return
d. withholding
e. deductions
f. gift tax
g. estate tax
C,hapter 14 61 )
NAME mmmmmmmmmmmmm css mmmm DATE m~~
Section 3: Gui ded Readi ng and Review
Federal Spendi ng
A. As You Read
As you read Section 3, provide examples of the categories of federal spending in the diagram
below.
1. Entitlements
Categories of Federal Spending
Federal
Spending
2. Discretionar Spending
3. Aid to States
4. discretionary spending mmmmmmm@mmmmmmmmmmmmmm
5. mandatory spending mmmmmmmmmmmmmmmmmmmm
6. entitlement mmmmmm@mmmmmmmmmmmmmmmmmmm
NAME @@w@@@w@@w@@ww css @wwww DATE @@@w
State and Local Taxes and Spendi ng
A. As You Read
A you read Section 4, fill in examples of each item in the space provided.
Spendig Sources of Revenue
(State Goverment) (Stat Goverment)
Provide examples of goods or servces on which state Provide examples of each type of tax from which
taxes are spent for each category. states earn revenue.
1. Education: 7. Sales Tax: @@@@@@@@@@@
2. Public Safety: 8. Excise Tax: @@@@@@@@@@@w
3. Highways and Transportation:
9. Income Tax: @@@@@@@@@@
4. General Welfare: 10. Corporate Income Tax: @@@@@@@
5. A and Recreation: 11. Business Taxes: @@@@@@@@@@
6. Administration: @@@@@@@@@@@
(Locl Govement)
Provide examples of goods or services on whch local
taxes are spent for each category.
12. Law enforcement: @@@@@@@
13. Public facilities: @@@@@@
14. Public health: @wwwwwwww
(Locl Goverment)
Provide examples of each type of tax from which
local governments earn revenue.
15. Property Taxes: @@@@@@@@
16. Other Taxes: @@@@@@@@@@@
17. What is the difference between real property and personal property? @@@@@@
18. What is the diference between an operating budget and a capital budget? @@@@
19. What is a sales tax? @@@@@@@@@@@@@@@@@@@@@@w@
20. What is the relationship between revenues and spending in a balanced budget? @@
NAME @m@@@@@m@@@ @ CLASS q@ qqq DATE. @@@@
Section 1: Guided Readi ng and Review
. Understandi ng Fi scal Pol i cy
A. As You Read
each question.
Main Idea: The president and Congress work through a budget process to draw up a spending
plan for the following fiscal year.
1. Which part of the executive branch is responsible for preparing the president's budget
proposal? q@@@@@@@@qq@@q@@q@q@@q@@q
2. Which congressional committees submit the final bills that authorize specific spending?
Main Idea: The federal goverent may use fiscal policy to try to make the economy run more
smoothly.
3. Under what conditions might the goverment use expansionary fscal polcies? q@@@
4. Under what conditions might the goverment use contractionary fscal policies? @@@@
Main Idea: The federal government has specific policies that it uses to infuence the economy.
S. What are its two main expansionary policies? @@qq@@@@@@q@q
6. What are its two main contractionary policies? q@q@@@@@@@@@
Main Idea: Although fscal policies may appear to be powerful economic tools, they can be difi
cult to put into practice.
7. What kinds of entitlement programs make it 'difficult to change spending levels?
8. Why does it take so long to put fscal changes into efect?
9. What is the federal budget? @@@m ==ww
10. What is the main fuction of the Congressional Budget Offce? @@q@@@@@
11. What is the overall goal of expansionary policies? @@q@@@@@qq@@
12. What is the overall goal of contractionary policies? @@@@@@@
( 6 Chaer 1 5 Guided Reading and Review
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Fi scal Policy Options
A. As You Read
As you read Section 2, answer the following questions.
1. What failure of classical e<oimics did the Great Depression highlight?
2. How did John Maynard Keynes explain the continuation of the Great Depression?
3. (a) According to Keynes, how could the Depression-era goverment make up for the drop
in private spending?
(b) What did Keynes say the result would be? @@@@@@@@@@@@@@
4. (a) What economic data did Keynes say the federal government should track?
(b) For what purpose? @@@@@@@@@@@@
5. Why did Keynesian economics lose popularity in the 1960s and 1970s? m@@@@@a
6. What is a stable economy?
7. When national income is low, how do taxes and government transfer payments help stabi-
lize the economy?
8. According to supply-side economics and the Lafer curve, how do higher tax rates afect
the economy?
9. What argument lies at the heart of supply-side economics?
10. How did President Kennedy propose to increase demand?
Use a key term to complete each sentence.
11. An economy sustains maximum output for a period of time when it operates at
12. The idea that in a free market, people act in their own self-interest, causing prices to rise or
fall so that supply and demand will always return to equilibrium is the thinking in
13. Taxes and transfer payments act as @@@@@@@
14. The idea that every dollar change in fiscal policy creates a greater than one dollar change in
the economy explains the m@@@@@@m
NAME mm+-~mmmmq css mm DATE @mmmmm
Budget De'ficits and the Nati onal Debt
A. As You Read
As you read Section 3, complete the following sentences.
1. Wen the goverment increases the amount of money in circulation to cover large deficits,
inflation results because mmmmmmmmmmmmmmmmmmm
2. Wise federal borrowing allows the government to mmmmmmmmmm mm@
3. The national debt will grow each year that @mmmmmmmmmmm
4. Te national debt is owned by mmmmm mmmmmm@=mmmmm
5. Historically, national debt as a percentage of GDP rises during mmmmmmmm
6. The two problems of a national debt are that @mmmmmmmm
7. The opportunity cost of servicing the debt is that

@mmmmqqqmm
8. Today, many economists think the role of the federal government in the economy should be
9. budget surplus mmmmmmmmmmmmmmmmmmmmmmmm@
10. hyperinflation mmmmmmmmmmmmmmmmqq
11. national debt mmmmmmmmmm mmmmmmmm
12. Treasury bill mmmmmmmmmmmmmmmmmmmmmmmm

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The Federal Reserve System
A. As You Read
As you read Section 1, supply the requested information.
1. Sources of confsion and problems with American banking between 1836 and 1907:
2. Why the Federal Reserve System was una.ble to hold off the Great Depression: @@@
3. How the chair of the Feder
l Reserve's Board of Goverors is appointed: @@@@

4. The function of each Federal Reserve Bank: @@@@@@ @@@@@@@
5. The makeup of each Federal Reserve Bank's board of directors: @@@@@@@
6. Which banks j oin the Federal Reserve System and why they join: @@@@@@@m
7. The main function of the Federal Reserve's Federal Advisory Council: @q@@@@
8. Areas affected by announcements from the Federal Open Market Committee: @w

&
@
9. monetary policy @@@@@@@@@@@@@@@@@@@@ @
10. Federal Reserve Districts @@@@@@@@@@@@@@@@ @@@
11. Federal Advisory Council @@@@@@q@@@@@@ @@@@
12. Federal Open Market Committee @@@@@q@@@@@@@@@@@
NAME a css mm DATE
Secti on 2: Guided Readi ng and Revie
w
Federal Reserve Functi ons
A. As You Read
As you read Section 2, complete each numbered item in the chart.
The Federal Reserve i n Acti on
Serice Roles
1. sells, transfers, and redeems
2. issues pa per
3. acts as a cl earing center for
4. checks up on activiti es of member banks by send-
i ng out
.
5. uses findi ngs and recommendations of Reserve
Banks to approve or disapprove
6. protects consumers by enforcing
7. i n severe recessions, pr,ovides commerci !l banks
with
Regulator Roles
8. col l ects daily reports on banks'
9. may force banks to sel l
10. may force probl em banks to undergo
11. subjects banks that go to the Fed for emergency
l oans too ofteR to
12. regul ates the nation's
13. compares Ml, M2, and M3 measurements with
the likely
14. uses its tools to try to stabil ize the nation's
overal l
Complee each sentence by writing the correct term i n the blank.
15. When a bank borrows money from another bank, the interest rate it pays is called the
16. Ownership of more than one bank constitutes a
17. When a bank customer writes a check, the check will go through the process of
18. A bank's total assets minus its total liabilities make up its
19. Banks repay loans from the Federal Reserve at a rate of interest called the
NAME @@@ CLSS @ DATE
Monetar Policy Tools
A. As You Read
A you read Setion 3, answer the following questions.
1. I you deposit $1,000 of borrowed money in a bank checking account, by how much do
you increase the money supply? @@@
2. Why does the Federal Reserve establish a required reserve ratio?
3. What three tools could the Federal Reserve use to adjust the money supply?
4. What two effects, leadig to an increased money supply, could a reduced RRR have?
5. Why does the Fed seldom, if ever, change bank reserve requirements? _
6. How do banks respond to a lowered discount rate?
7. How does a raised discount rate afect bank loans and the money supply? @@@
8. What effect does the Fed's purchase of goverment bonds have on the money supply?
9. How does the Fed's sale of bonds reduce the money supply? @
10. Which of its monetary policy tools does the Federal Reserve use most often? @@@

Rewrite each statement below as needed to make it correct.
11. Money creaton is the process by which money is manufactured.
12. The required resere ratio is the ratio of reserves to loans required of banks by the Federal
Reserve. _
13. The size of loans created with each demand deposit is measured by the money multiplier
fonnu. @, _,
14. Open market operations refers to the buying and selling of banks by the Federal Reserve.
Guided Reading and Review Chaper 16 61
NAME mmmmm css mmmm DATE mmmm
Monetar Poli cy and Macroeconomic Stabi l ization
A. As You Read
As you read Section 4, complete the following sentences.
1. The cost of borrowing or having money is the mmm
2. If the money supply is high, interest rates will be mm@
3. Lower interest rates give frms more opportunities for @
4. The Fed may follow an easy money policy when the macroeconomy is experiencing a
5. The Fed may follow a tight money policy when the macroeconomy is experiencing a
6. The goal of stabilization policy is to smooth out fuctuations in the mm
7. If expansionary policies take effect while the macroeconomy is already expanding, the
result could be higher mm
8. One. reason for inside lags is that it takes time to m
9. A second reason for inside lags is that it can take additional time to @
10. Monetary policy can be put in place almost immediately by the @@@
11. The outside lag can be relatively short for policy.
12. Outside lags for monetary policy can be lengthy because they primarily afect
13. We rely more on the Fed to combat the business cycle because fiscal policy is ofen delayed
by m
14. Economists who usually recommend enacting fiscal and monetary policies believe that
economies @m
15. monetarism mmmmM
16. easy money policy m@mm@mmm@mmm
17. tight money policy m_ mmmmmmmmmm
18. inside lag m@@@@@mM
19. outside lag mmmm@m@@M
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Why Nations Trade
A. As You Read
As you read Section 1, answer the following questions about international trade in the spaces
provided.
1. What resources are major influences on a country's or region's economy? ,,
2. Why do countries differ in their capacities to produce different goods and services?
3. Why do specializing nations need world trade? ,
4. Why does trade benefit both countries with abundance and countries with few resources?
5. How do nations benefit from producing goods and services they have a comparative
advantage in supplying? __________
6. How can international specialization affect some workers?
g
7. What possibilities do laid-off workers face? ,

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C
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S
@
Briefly define or identify each of the following.
8. absolute advantage ,gmmm
9. export ___g,
10. llnport ,
11. comparative advantage ,
NAME mq@@@@@@@@q@@ css @@@m DATE @@@@&
Trade Barri ers and Agreements
A. As You. Read
As you read Secton 2, supply the missing information inthe spaces provided.
Current World Trade Considerations
1. Effects of Trade Barriers: @@q@@@@@@m@@@@@@@@@q@m
2. Presumed Advantages of U.S. Protectionism: @g@@q@@q@@@@@g
3. Progress Under GAIT and WTO: q@qg@m.q@g@@@gm@@g
4. Results of NAFTA in the United States: @@@@@@@@@@@@@@@@@
5. Advantages of Multinational Corporations: @q@q@@@@@@q@@@@&
Match the definitions in Column I with the terms in Column I. Write the letter of the correct
answer in the blank provided. You will not use al of the tens.
Column I
6. use of trade barriers to shield a nation's industries from foreign
competition
7. regional trade organization of 15 European nations
8. self-imposed limitation on the number of products shipped to a
particular country
9. means of preventing a foreign product or serice from freely .
entering a nation's territory
Column II
a. European Union (EU)
h. infant industry
c. tade barrier
d. NAFTA
e. tarif
f. World Trade Organization
(WTO)
10. limit on the amount of a good that can be brougt into a country
g. import quota
11. region where a group of countries agees to reduce or eliminate
trade barriers
. h. voluntary export restraint
12. tx on imports
i. free-trade zone
j. protectionism
( 72 Chaptr 11 Guided Reading and Review
NAME @@@@@@@@g@@@ css ==== DATE @@g@=
Measuri ng Trade
A. As You Read
As you read Section 3, supply likely consequences or solutions in the chart.
In Maters of International Trade
1. a U.S. tourist wats to buy a 1.
newspaper in Beijing
2. you want to lear current 2.
exchange rates
3. a strong dollar makes American 3.
products more expensive in Japan
4. the dollar is devalued 4.
5. an American firm needs to 5.
exchange yen for dollars
6. low labor costs abroad result in
lower-prices for U.S. imports
6.
Briefly explain the diference beteen the terms in each pair.
7. fixed exchange-rate system and flexible exchange-rate system @@@@@@@
8. trade surplus and trade deficit @mq@@@@@@@q@gg@@
9. appreciation and depreciaton @@m@@q@@@q@@q@q@ @
NAME =mmwmwwmmmmmmmm CLSS =mmmmm DATE mmmmm,
Level s of Devel opment
A. As You Read
As you read Section 1, fill in details comparing characteristics of developed nations and less
developed countries in the blanks provided.
per capit GOP
energy consumption
labor force
Devel oped Nations
1. ,,,,,,
3. ,@,
5. =mmmmmm@=
literacy 7. mmmmmmmmmm
life expectancy & infant mortality 9. =mmmmmmm=
Less Developed Countries
2. mmmmmmmm=
4. @,
6. =mm@mmmm=
8. mmmmmmmmm
10. ,@
Match the descriptions in Column I with the terms in Column II. Write the letter of the correct
Column I
11. services and facilities necessary for an economy to function
12. country with low levels of material well-being
13. a nation's GOP divided by its total population
14. more successful less developed coutry
15. raising j ust enoug food to feed one's family
16. average exected life span of an individual
17. process by which a naton improves the economic, political,
and social well-being of its people
18. proportion of the population over age 15 that can read and
write
19. cOltry with a higher average level of material well-being
20. the number of deaths that occur in the first year of life per
1,000 live birts
21. extensive organization of an economy for the purpose of
manufacture
( 14 Chapter 18
Column I I
a. development
h. subsistence agricuture
c. infant mortality rate
d. industialization
e. deveoped nation
f. infrastructure
g. life expectancy
h. newly industrialized country
(NC)
i. literacy rate
j. per capita gross domestic
product (per capita GOP)
k. less developed country
NAME ..= css m DATE =m
I ssues i n Devel opment
A. As You Read
As you read Section 2, supply the missing effects of problems suffered by less developed coun
tries in the spaces provided.
Cause: Rapi d popul ation growth
1.
Cause: Uneven global di stribution of resources
3. E
fe
ct
: ..aaaaaaaaaaaaa&
Cause: Lack of human capItal
4.
5. E
f
ec: ammmmmmmmmmmmmammmm
Cause: Col omal dependency
6. E
f
ect: aaaaamaaa~
7. E
f
ect: mmmmmmm,mmm,mmmmmm,mm&
Cause: Political mstabi l i ty
8. E
f
ect: mmaamaamaaaamaamaaaaaaaaa~
9. E
f
ect: maaaaaaaaaaaaaaa.=amaa~
Complete each sentence by writing the correct term i the blank.
10. Land suitable for producing crops is considered
m..a
1 1. The increase in a country's population in a given year is called the
12. The difference between a country's death rate and birth rate is called the
13. People who get too little nutritional food suffer from aaa
Guided Reading and Review Chapter 18 75)
NAME wwwwwwwwww CLSS qwwwww
Financing Development
A. As You Read
DATE wwww
List three advantages economists believe multinational corporations bring to LDCs.
1. wwwwwwwwwwww........... ....
2. m~~wwwwwwwww
3. mwwwwwwwwwwww
List three disadvantages economists believe multinational corporations bring to LDCs.
4. wwwwwwwwwmwwwmmwq
5. wwwwwwwwwwwwwwwww
6. wwwwwwwwwwwwwwwwwww
Give an example of why nations provide aid to less developed countries.
Humanitarian:
7. wwwwwwwwwwwwwwwwwwwwwwww
Political and Military:
8. mwwwwwwwwwwwwwwwwwwww
9. wwwwwwwwwwwwwwwwwwwm
10. internl fnancing wwwwwwwwmwwwwwwm
11. foreign investment wwwwwwwwww
12. foreign direct investment (FDI) wwwwwwwwwww
13. foreign porfolio investment wwwwwwwwwwmw
14. United Nations Development Program (UP) wwmww
15. World Bank wwwwwwwwwwwwwm
16. Interational Monetary Fund (IM) wwwwwwwwwww
17. debt rescheduling mwwwwwwwwwwwwwwwwwwm
18. stabilization program qwwwwwwwwwwwmmmmw

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Guided Reading and

NAME mmmmmmmmmmmmmm css mmmmmm DATE ~m

9. Ownership interests and management responsibilities are legislated under the

6. What guarantee was made available to bank customers in 1933? @@@@@@

6. @a&a&aa 10. _ma&aa& &

7. The opportunity cost of servicing the debt is that

l Reserve's Board of Goverors is appointed: @@@@

B. Reviewing Key Terms

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