1. 2. 3. 4. C H A P T E R C H E C K L I S T. When you have completed your study of this chapter, you will be able to. Describe the patterns and changes in what goods and services are produced in the United States.
4C H A P T E R C H E C K L I S T
Describe the patterns and changes in how goods and services are produced in the United States.
Use the circular flow model to provide a picture of how households, firms, and governments interact to determine what, how, and for whom goods and services are produced.
Figure 2.1(a) shows
what we consume.
Americans spend the largest share of their income on:
Figure 2.1(b) shows
that Americans spend:
And the largest five items of goods produced.
Figure 2.3 shows the five largest items that we buy and import from the rest of the world.
Factors of production
The productive resources used to produce goods and services.
Factors of production are grouped into four categories:
Figure 2.4(a) shows that almost 50 percent of the land in the United States forest, parks, and water.
Agricultural land is about 47 percent of the total and is decreasing slightly.
Urban land is about 5 percent of the total and is increasing slightly.
Figure 2.4(b) shows the urban distribution.
A quarter lives in the six largest cities.
Almost a third live in the ten largest cities.
More than a half lives in cities that exceed 1 million.
Figure 2.5 shows how long the known reserves of nonrenewable energy resources will last at the current growth rates of use.
New reserves are constantly being discovered.
how it has
Proprietors’ income 9%
Corporate income 9 %
Net interest income 8%
The poorest 20% earned only 5% of total income.
The richest 20% earned 47% of total income.
During the early 2000s, the federal government is spending and collecting in taxes more than $2 trillion a year—about 20 cents in every dollar earned.
Households and firms pay taxes and receive transfers.
Governments buy goods and services from firms.
The largest part of the state and local governments expenditures are on:
shows state and