Directions: 

Write your answer to each question. Use complete sentences.

1. Explain how the role of government in the U.S. economy has changed.

  Before 1800: The U.S. had a volatile, yet greatly expanding economy in the 19th century
due to industrialization, immigration, territorial expansion, new technological innovations and
other trends.
A laissez-faire means let it be approach by government and poorly regulated banking led to
volatility.

  Today: Large U.S. corporations also play a major role on the global stage, with more than a
fifth of companies on the Fortune Global 500 coming from the United States. Even though the
services sector is the main engine of the economy, the U.S. also has an important manufacturing
base, which represents roughly 15% of output.

Agency Functions
Federal Reserve System The roles and responsibilities of the Federal Reserve System
have expanded, and its structure has evolved. Events such as the
Great Depression were major factors leading to changes in the
system.

Securities and Exchange Commission It holds primary responsibility for enforcing the federal securities
laws and regulating the securities industry, the nation's stock and
options exchanges, and other things, including the electronic
securities markets in the United States

Department of Labor The U.S. federal government responsible for occupational safety,
wage and hour standards, unemployment insurance benefits, re-
employment services, and some economic statistics; many U.S.
states also have such departments. The department is headed by
the U.S. Secretary of Labor, which is held by Thomas Perez
since July 2013.

The purpose of the Department of Labor is to foster, promote,

and develop the welfare of the wage earners, job seekers, and
retirees of the United States; improve working conditions;
advance opportunities for profitable employment; and assure
work-related benefits and rights. In carrying out this mission,
the Department of Labor administers and enforces more than
180 federal laws

2. Explain the functions of each of the agencies in the chart below.

3.What is globalization?

  the process by which businesses or other organizations develop international influence or start
operating on an international scale.

4. What is the purpose of trade with other nations?

The agreement came into force on January 1, 1994. It superseded the Canada–United States Free Trade Agreement
between the U.S. and Canada. In terms of combined purchasing power parity GDP of its members, as of 2007 the
trade bloc is the largest in the world and second largest by nominal GDP comparison.

5. List the three main trading partners of the United States.

1. Canada
2. Mexico
3. China

6. What is the goal of protectionism?

The overall goal of protectionism is to limit competition for products

domestically, allowing local businesses to succeed by creating higher prices for
imported goods. It may also be combined with subsidies for local businesses
which make local products cheaper.

7. List and define three types of trade barriers in the chart below.

Trade Barrier Definition

Tariff Developed from a tabular list of tax

rates for different imported goods.

Important Quota Is a limit on the quantity of a good

that can be produced abroad and
sold domestically?

Embargo Is the partial or complete or

complete prohibition of commerce
and trade with a country.
8. How has NAFTA affected the U.S. economy?

   Decrease in Jobs Since labor is cheaper in Mexico, many US-based companies simply relocated
their companies across the border, thereby causing a large enough loss of jobs. If that was not enough,
other companies threatened workers with plant closure and relocation to Mexico to prevent their workers
from forming unions

   Increase in It superseded the Canada–United States Free Trade Agreement between the U.S. and Canada. In
terms of combined purchasing power parity GDP of its members, as of 2007 the trade bloc is the largest in the world
and second largest by nominal GDP comparison.

9.Explain the functions of each of the organizations listed in the chart

below.

Organization Functions

World Trade Organization The organization deals with regulation of trade

between participating countries; it provides a
framework for negotiating and formalizing trade
agreements, and a dispute resolution process aimed at
enforcing participant's adherence to WTO
agreements, which are signed by representatives of
member governments[6]:fol.9–10 and ratified by their
parliaments.[7] Most of the issues that the WTO
focuses on derive from previous trade negotiations,
especially from the Uruguay Round (1986–1994).

The World Bank's official goal is the reduction of

World Bank poverty. According to its Articles of Agreement (as
amended effective 16 February 1989), all its decisions
must be guided by a commitment to the promotion of
foreign investment and international trade and to the
facilitation of capital investment.[4]

The World Bank comprises two institutions: the

International Bank for Reconstruction and
Development (IBRD) and the International
Development Association (IDA).

The IMF's stated goal was to assist in the

International Monetary Fund reconstruction of the world's international
payment system post–World War II.
Countries contribute money to a pool through
a quota system from which countries with
payment imbalances can borrow funds
 temporarily. Through this activity and others
such as surveillance of its members'
economies and the demand for self-correcting
policies, the IMF works to improve the
economies of its member countries.[1]

10. List the positive and negative effects of globalization on the U.S.

economy.

Positives
Negative
1. Culture Exchange
1. Social Injustice
2. Flow of
2. Damage some Globalization Communication
economy
3. Human Sensitivity
3. Favors nations
4. Legal Effects
with more
5. Reduces Social
resources
Tensions
4. Annihilation of
6. Language Exchange
minor
7. Larger Market
languages
8. Business
5. Fewer
Empowerment
Employment
9. Helps consumers
Opportunities
10. Market Competition
6. The threat to
11. Helps Consumers
some national
economies
7. Dominance to
limited number
of nations
8. Price
Fluctuations
9. Environmental
Destruction
10. Disease and
Pest Transfer