Geography Assessment Target Cards Answer Key
Profit / Definition: What is left over after all expenses have been paid.Example: Exxon Mobil had $44.8 billion left in 2012 after it paid all its expenses.
Opportunity Cost / Definition: The value of what we give up when we make a decision, the next best alternative.
Example: I have a choice between going to the movies or studying for a test. Since I choose to study, going to the movies is my
______.
Entrepreneurship / Definition: Taking a risk by starting a new business.
Example: Jeff Bezos starts Amazon.com to sell books and later almost everything else.
Comparative advantage / Definition: The ability to make something or provide a service at a lower opportunity cost than someone else.
Example: Since labor in China is so cheap, they can produce textiles more cheaply than the United States can.
Tariffs / Definition: A tax on imports or exports.
Example: When these are placed on imports, it raises the prices of goods coming into a country making it more expensive for people to buy.
Fiscal Policy / Definition: The government changes tax rates and/or government spending to influence the economy.
Example: When the government cuts taxes, it hopes people will have more money to spend.
Productivity / Definition: The pace that work is completed.
Example: United States factory production has more than doubled since 1975 while employing one-third fewer workers.
Inflation / Definition: An increase in prices and a fall in the purchasing power of money.
Example: In early 2003, gas cost $1.43 a gallon. In early 2014, gas costs $3.31 a gallon.
GDP / Definition: Gross Domestic Product – The total value of all goods and services produced in a country during a year.
Example: In 2012, the United States produced $16.2 trillion dollars of goods and services.
Unemployment / Definition: People who are actively looking for work and cannot find work.
Example: During recessions more people are without work. During the Great Recession that began in late 2007, this rate moved above 10%.
Markets / Definition: The place where goods, services, money and labor are exchanged. For example, we exchange our labor for money when we work.
Example: The store, a place where we trade our money for something we want to buy, is an example of this.
Deflation / Definition: A decrease in the price level of goods and services.
Example:During 1930 - 32, the cost of goods and services decreased by about 10 percent.
Monopoly / Definition: One business controls a market.
Example:Power companies are regulated types of this. They are the only business that supplies electricity in a certain area.
Competition / Definition: More than one person or business works to get business from consumers
Example: There are several grocery stores that work to get people’s business. They may have sales or be open more hours to attract customers.
Consumer Credit Laws / Definition: These laws prohibit discrimination in trying to get credit based on race, religion, sex, or marital status. The state Attorney General’s office can investigate discrimination claims.
Example: Iwant Credit is denied a home loan. She feels she was discriminated against because she is a Muslim. She calls the state Attorney General’s office.
Interdependence / Definition: Countries depend on each other to get the goods and services they need to make different products
Example: The parts to make a cell phone come from all over the world. No one country can easily produce all the parts needed so they depend on each other to get parts to make phones.
Incentives / Definition: Rewards offered to get people to change their behavior. People may be motivated to buy something if it’s on sale.
Example: A bonus provided motivation for a salesperson to meet their monthly goal.
Supply / Definition: How much there is of a good or service.
Example: If they are able to get a high price, businesses will usually make more of a product. They will offer less for sale as prices go down.
Demand / Definition: How much people want a good or service.
Example: As prices go up, people will usually want less of something. As price goes down, people will want more.
Price / Definition: The cost of a good or service. It is determined by supply and demand.
Example: A gallon of gas costs $3.25
Supply and demand determine price / Definition: How much there is of something and how much people want it determine how much something costs. In the labor market, it also determines how much people are paid.
Example: A pro baseball player can earn well over $1 million dollars a year since there are few people in the world that can hit or throw a 95 mile per hour fastball.
Example: Since there are so many people who can run a cash register at a fast food restaurant, they are not paid much over minimum wage.
Individual choice / Definition: Since we do not have money to buy everything we want, we need to decide what is most important to us.
Example: Since I have only a certain amount of money to spend each month, I choose what things to buy for my family.
Investment / Definition: Buying something now hoping to get a profit on it in the future.
Example: Many people buy homes or stock hoping they will increase in value so they will earn a profit.
Government Failure / Definition: The government tries to fix the market through things like subsidies, taxes, or price controls. This causes problems in the market like shortages or surpluses of certain things.
Example: Because inflation was going up so much, the government decided to set price controls. This caused shortages of meat products.
Market Failure / Definition: Businesses make too much or too little of a product. This can also happen when companies make a product at a lower cost than the cost of its impact on society.
Example:Altria Corporation can make cigarettes for 35 cents each but the cost to society in increased health care costs is 70 cents per cigarette.
Example: During the Christmas season in 1998, the Furby was the most wanted toy. There were not enough in stores and some people paid ten times the regular retail price to get one for their kids.
Specialization / Definition: A business focusing on making one product or providing one service.
Example:Because the climate is perfect for it, the Quarry Hill Farm only makes maple syrup.
Example: Since it is surrounded by water, Hawaii’s leading export is seafood.
Labor / Definition: The human effort (physical and mental) that makes a product or provides a service.
Example:The number of those working in the United States in 2014 is about 155 million.
Capital / Definition: The money companies use to buy the raw materials and labor used in their business. It also refers to the buildings and equipment a company owns.
Example:United Parcel Service (UPS) has a lot of this in the form of warehouses, planes, and trucks that deliver their packages.
Installment Credit / Definition: A type of loan where the borrower pays equal amounts each month over a certain amount of time.
Example: To buy a new car, Jalisa used this type of credit. She will pay $432.67 every month for five years.
Revolving Credit / Definition: Consumers can borrow up to their spending limit and must make minimum monthly payments. Interest is charged on the unpaid balance each month. Credit cards are examples of this.
Example: Iuse Credit has a Visa card that she makes minimum payments on and pays interest every month.
Open Credit / Definition: A type of credit where the bill must be fully paid at the end of each billing cycle, and the amount of the payment is different each month. Accounts with power companies are examples of this.
Example: Sherita has an account with Duke Power Company. She must pay her full electric bill each month and the amount is always different depending how much energy she uses.
Economic Institutions / Definition: Government or private agencies that perform activities important to the economy. An example is the Internal Revenue Service, a government agency that collects taxes.
Example: The Federal Reserve performs the important function of regulating the money supply in the US.
Regulations and Costs of Government Policies / Definition:The government enforces policies like environmental regulations for clean air and water. Following these regulations costs companies money which is paid by the consumer in higher prices.
Example:Arch Coal Inc. must follow government environmental regulations for clean air. This increases their cost of production which creates higher coal prices.
Savings / Definition: An amount of money not spent now that is put away for future use.
Example:Certificates of Deposit (CDs) are one way people do this. They deposit money with a bank to earn interest.
Banking / Definition: These financial institutions provide loans, checking accounts, and savings accounts. They charge interest on loans and pay interest on deposits.
Example:Bank of America provides consumers with credit and debit cards. They also make loans and provide savings accounts.
Economic Causes of Wars / Definition: Countries will go to war to protect their supply of natural resources. Some argue that the US invaded Iraq in 2003 to protect its oil supply.
Example:Japan attacked the United States on December 7, 1941 because the US froze Japanese assets which meant Japan could not buy oil, and the US refused to sell metal to Japan.
Economic Impacts of Wars / Definition: The government increases military spending. There is usually an increase in employment and production (GDP). There is also usually an increase in taxes, inflation, and the national debt.
Example:World War II helped bring the United States out of the Great Depression as the need for weapons put people to work in defense factories.
Example:After losing World War 1, Germany suffered massive inflation during the 1920s.
Economic Drivers of Exploration and Colonization / Definition:Countries financed voyages of exploration and set up colonies in order to get raw materials for production and create markets to sell finished goods.
Example:Great Britain established colonies in North America in order to get raw materials for production like timber, sugar, tobacco, and cotton. They also sold clocks to colonists.
Scientific Revolutions / Definition: These add technology to the economy. New technology increases productivity, eliminates some jobs, and creates jobs in new fields.
Example:The personal computer radically changed the way the world works. Instead of using a typewriter, users were able to word process documents much more easily.
Example:The Internet drastically changed the way the world works. People can connect to others across the globe and buy almost anything online.
Industrial Revolutions / Definition: During the 1760s to 1840s, manufacturing moved from being done by hand to being done by machines. Factories were built, worker productivity increased, and more people lived in cities.
Example:The steam powered train replaced horse-drawn stage coach travel making it much easier to travel long distances.
Example:Instead of producing cloth by hand, the power loom machine made each worker 40 times more productive.
Relationship between Political and Economic Freedoms / Definition: Political and economic freedom work together. Usually free market (capitalist) economies have democracies. State controlled (communist) economies have totalitarian governments.
Example:The United States has a capitalist economy and a democracy. North Korea has a communist economic system and is ruled by a dictator.
Great Depression
1929 - 1941 / Definition:This economic crisis led to greater government intervention in the economy. The US Government started Social Security, made a minimum wage, and created programs to put people to work.
Example:During the 1930s, the US Government created programs like the Civilian Conservation Corps (CCC) that created jobs for young men.
Example:In 1935, the US Government created Social Security that provides a pension for older Americans and other benefits for the disabled.