civics and economics eoc review eoc review civics and economics money, banking and international...

Civics and Economics EOCReview

EOC ReviewCivics and Economics

Money, Banking and Money, Banking and International TradeInternational Trade


•What are the What are the functions of money?functions of money?


1.1. Medium of Medium of exchangeexchange

2.2. Store of valueStore of value

3.3. Measure of valueMeasure of value


•What are coins?What are coins?

•What is currency?What is currency?


•Currency-Currency- includes includes coins and paper coins and paper money.money.


•What are What are commercial banks?commercial banks?


• Commercial banks are Commercial banks are financial institutions financial institutions that offer full banking that offer full banking services.services.–Examples?Examples?


•What is the FDIC?What is the FDIC?


• FDIC- Federal Deposit FDIC- Federal Deposit Insurance Insurance Corporation- insures Corporation- insures individual account up individual account up to $100,000.to $100,000.


• What is the Fed?What is the Fed?

• How many district How many district banks does it include?banks does it include?


•The Fed is the The Fed is the central bank of the central bank of the United States.United States.–Divided into 12 district banks.Divided into 12 district banks.


•What group What group oversees the oversees the direction of the Fed?direction of the Fed?


• A Board of Governors A Board of Governors oversees the Fed.oversees the Fed.–They are appointed by the Pres. They are appointed by the Pres.

and approved by the Senate.and approved by the Senate.


•What is monetary What is monetary policy?policy?


• Monetary policy- Monetary policy- controlling the supply controlling the supply of money and the cost of money and the cost of borrowing money.of borrowing money.


• If the Fed wants to lower If the Fed wants to lower the interest rates….the interest rates….

• If the Fed wants to raise If the Fed wants to raise the interest rates…the interest rates…


• ExpandingExpanding the $ supply the $ supply = a lower interest rate.= a lower interest rate.

• ContractingContracting the $ the $ supply = a higher interest supply = a higher interest rate.rate.


•What are the types What are the types of deposit accounts?of deposit accounts?


•Checking accountChecking account

•Savings accountSavings account

•Certificates of Certificates of Deposit (CDs)Deposit (CDs)


•What act of What act of Congress Congress established the established the FDIC?FDIC?


•Glass-Steagall Glass-Steagall Banking ActBanking Act


•What is the Gramm-What is the Gramm-Leach-Bliley Act?Leach-Bliley Act?


• 1999; permits bank 1999; permits bank holding companies to holding companies to engage in a full range engage in a full range of banking activities.of banking activities.–Could create “universal banks”Could create “universal banks”


•What are imports?What are imports?

•What are exports?What are exports?


• Imports-Imports- goods goods purchased from other purchased from other countriescountries

• Exports-Exports- goods sold goods sold to other countriesto other countries


•What is comparative What is comparative advantage?advantage?


•Comparative Comparative advantage:advantage:–Ability of a country to Ability of a country to

produce a good at a lower produce a good at a lower cost than another country cost than another country can.can.


•Why do nations Why do nations trade?trade?


1.1. To obtain goods they To obtain goods they cannot producecannot produce

2.2. Comparative Comparative AdvantageAdvantage

3.3. To create jobsTo create jobs


•What are tariffs?What are tariffs?


•Tariff-Tariff- custom tax, custom tax, tax on imported tax on imported good.good.


•What is a quota?What is a quota?


•Quota-Quota- limits on the limits on the amount of foreign amount of foreign goods importedgoods imported


•What does free What does free trade mean?trade mean?


•Free trade-Free trade- no limits no limits or laws that block or laws that block trades.trades.


•What is the What is the European Union?European Union?


• The European Union The European Union (EU) is a regional (EU) is a regional trade agreement in trade agreement in Europe.Europe.–Share currency, free trade Share currency, free trade

agreements, etc. agreements, etc.


•What is NAFTA?What is NAFTA?


•North American North American Free Trade Free Trade AgreementAgreement (US, (US, Canada, Mexico)Canada, Mexico)


•What is the WTO?What is the WTO?


•WTO-WTO- World Trade World Trade Organization. Organization. –International body regulating International body regulating

trade among nations.trade among nations.


•What is a trade What is a trade deficit?deficit?


•Trade deficit-Trade deficit-–When the value of the When the value of the

products it imports exceeds products it imports exceeds the value of the products it the value of the products it imports.imports.


•What is a What is a trade trade surplus?surplus?


•Trade surplus- Trade surplus- –When the value of its exports When the value of its exports

exceeds the value of its exceeds the value of its imports. imports.


•What is the What is the United Nations United Nations (UN)?(UN)?


• The United Nation’s The United Nation’s goal is keeping peace goal is keeping peace among the countries among the countries of the world. of the world.


•What are the 3 What are the 3 types of taxes?types of taxes?


1.1. Proportional Proportional Taxes:Taxes:

• percentage paid in tax percentage paid in tax remains constant as remains constant as income of the taxpayer income of the taxpayer changes. changes.


•2. Progressive Tax:2. Progressive Tax:–Tax rate increases as your Tax rate increases as your

income increases (income income increases (income tax)tax)


•3. Regressive tax:3. Regressive tax:–Percentage you pay in tax Percentage you pay in tax

goes down the higher your goes down the higher your income grows. (sales tax)income grows. (sales tax)


•What is an excise What is an excise tax?tax?


• Excise taxes are taxes paid Excise taxes are taxes paid when purchases are made when purchases are made on a specific good, such as on a specific good, such as gasoline. Excise taxes are gasoline. Excise taxes are often included in the price of often included in the price of the product the product – Ex) gasoline, cigarettes, alcoholEx) gasoline, cigarettes, alcohol


•What is the Estate What is the Estate Tax?Tax?


•Estate Tax:Estate Tax:–imposed on the transfer of imposed on the transfer of

the "taxable estate" of a the "taxable estate" of a deceased person deceased person


•What are some What are some examples of Payroll examples of Payroll taxes?taxes?


•Medicare, Social Medicare, Social Security, etc. Security, etc.

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nations trade

trade deficit

trade surplus

estate tax

tax rate

free trade mean

free trade agreements

progressive tax