AP U.S. GOVERNMENT & POLITICS" CH. 17: ECONOMIC POLICYMAKING"

Use your text to answer the following on a separate sheet of paper:

1. Describe America’s mixed free-enterprise economic system. Make sure to include the government’s role.

2. Describe the role of the government in the economy in the following historical time periods. Make sure to include specific examples for each time period:

a) Prior to the 20th century

b) During the Progressive Era

c) During the Great Depression and the New Deal

d) Late 20th – early 21st centuries

3. What is “fiscal policy” and who controls it?

4. Identify and explain the economic theory of John Maynard Keynes.

5. Identify the negative consequences of maintaining a budget deficit.

6. How did the government’s response to the “Great Recession” fit into the Keynesian model of fiscal policy?

7. What is the “debt ceiling?” Describe the problem with the debt ceiling in 2011.

8. What is “monetary policy” and who controls it?

9. Explain the organization and role of the Federal Reserve System in regulating monetary policy.

10. Define “income security programs.”

11. What is the difference between means-tested and non-means-tested programs?

12. Describe how each of the following income security programs work.

a) Social Security

b) SSI

c) TANF

d) SNAP & WIC

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ESSAY: You may use bullet points to brainstorm your response to the following essay question:

Fiscal policy and monetary policy are two tools used by the federal government to influence the United States economy. The executive and legislative branches share the responsibility of setting fiscal policy. The Federal Reserve Board has the primary role of setting monetary policy.

(a) Define fiscal policy.

(b) Describe one significant way the executive branch influences fiscal policy.

(c) Describe one significant way the legislative branch influences fiscal policy.

(d) Define monetary policy.

(e) Explain two reasons why the Federal Reserve Board is given independence in establishing monetary policy.