| A | B |
|---|
| fiscal year | any 12 month period chosen for keeping accounts |
| Oct1-Sept 30 | the government's fiscal year |
| mandatory spending | federal spending required b law tht continues without need for congressional approval each year |
| discretionary spending | spending for federal programs that recieve approval every year |
| appropriations bill | legilation that sets spending on a prticular program for coming year |
| House of Representatives | where appropriations bills start |
| balanced budget | a situtioan that occurs when a government collects more revenue than it spends |
| budget deficit | situaiton that occurs when a government spends more than it collects inrevenue |
| debt | money borrowed and not paid back over the course of time |
| fiscal policy | how the government uses taxes and spending to reach economic goals like price stabillity and employment |
| automatic stabilizers | any economic feature that works to increase or preseve income with out additional goverment action ex. unemployment insurance and progressive income tax |
| Proportional | every one pays the same rate |
| flat tax | another name for proportional |
| Progressive | % increases as you make more money- our current income tax |
| graduated income tax | another name for progressive tax system |
| Regressive | % goes down as your income increases ex. Sales tax |
| net income | is the total amount you earn minus taxes and pretax exemptions |
| gross income | is the total amount you earn |
| expansionary fiscal policy | an increase in government expenditures and/or a decrease in taxes that causes the government's budget deficit to increase or its budget surplus to decrease. |
| conractionary fiscal policy | a decrease in government expenditures and/or an increase in taxes that causes the government's budget deficit to decrease or its budget surplus to increase. |
| monetary policy | Changing the money supply to affect the cost of credit, economic growth and price stability |
| The Federal Reserve | A central bank is a banker’s bank that banks can go to to borrow money when times are tough. |
| income tax | Taxes you pay when you buy something |
| excise tax | Taxes only applied to certain items like alcohol and cigarettes |
| social Security tax | Takes a percentage of your earnings and puts it into a retirement system |
| property tax | local goverments fund Schools and fire services by these taxes paid on land |
| tariffs | Taxes on goods that are imported into the US from other countries |
| estate tax | Tax the government collects when a person dies |
| medicare tax | Takes a percentage of your earnings and puts it into healthcare system |
