Unit 4 Vocabulary Public Policy and the Economy

Front

Medium of exchange

Back

What people are willing to accept in exchange for goods and services

Front

Standard of value or measure of value

Back

Allows people to compare the values of goods and services using prices

Front

Store of value

Back

Allows people to save for future consumption

Front

Commodity money

Back

Items that have value in themselves other than being used as a monetary unit (e.g., gold, tobacco, salt)

Front

Representative money

Back

Items that have no value in themselves, but can be exchanged for something of value (e.g., gold certificates, silver certificates, checks)

Front

Fiat money

Back

Money that has value simply because the government has decreed it to be an acceptable means to pay debts (e.g., Federal Reserve Notes)

Front

Income tax

Back

A tax levied on a person’s earnings. Income taxes provide the largest source of revenue to the national government.

Front

Excise tax

Back

General revenue tax on items like cigarettes, gasoline, or alcohol

Front

Property tax

Back

Tax levied on property owners for local services and education

Front

Tariffs

Back

Tax levied against importers of goods