Federal Government Spending Overview

Questions and Answers

What is mandatory spending?

Spending that can be adjusted by the budget

Spending required by law (correct)

Spending that requires government authorization each year

Spending not required by law

What is discretionary spending?

Spending that must be authorized each year (correct)

Spending that is authorized by law

Spending for mandatory programs

Spending without any limitation

What are entitlements?

Social welfare programs with specific requirements

What is Medicaid?

A government medical insurance program for low income people Signup and view all the answers

What is the federal budget?

A plan for spending federal tax money Signup and view all the answers

What is a fiscal year?

A 12 month period for which an organization plans its expenditures Signup and view all the answers

What is an appropriation?

Specific amounts of money set aside for specific purposes Signup and view all the answers

What are transfer payments?

Money distributed to individuals who do not provide anything in return Signup and view all the answers

What is a grant-in-aid?

A transfer payment from the federal government to state or local governments Signup and view all the answers

What is the private sector?

The part of the economy owned by individuals or businesses Signup and view all the answers

What is the difference between mandatory spending and discretionary spending?

Mandatory spending is required by law; discretionary spending must be authorized by the government each year. Signup and view all the answers

Why is Medicaid an example of an entitlement program?

Because it is a social welfare program with specific requirements, specifically a health care program for low income people. Signup and view all the answers

Study Notes

Federal Government Spending

Mandatory Spending: Required by law; does not need annual approval.
Discretionary Spending: Authorizations needed each year; includes government departments and agencies.
Entitlements: Social welfare programs that provide benefits to individuals meeting specific criteria; automatically funded.
Medicaid: A government program offering medical insurance specifically for low-income individuals and families.
Federal Budget: A comprehensive plan outlining the allocation of federal tax revenue for various expenditures throughout the fiscal year.
Fiscal Year: A 12-month period used by organizations for accounting and budgeting; not always aligned with the calendar year.
Appropriation: Designated amounts of money allocated for specific governmental functions or projects.
Transfer Payments: Financial distributions to individuals without a requirement for services in return; often aimed at providing social support.
Grant-in-Aid: Financial assistance from the federal government to state or local governments for specific projects or programs.
Private Sector: The portion of the economy comprised of businesses and entities owned by individuals, distinct from government ownership.
Comparison of Spending Types: Mandatory spending is dictated by law, while discretionary spending requires annual government approval, often influencing budgetary priorities.
Medicaid's Role: Serves as an essential entitlement program for healthcare access among low-income citizens, ensuring necessary services are provided based on eligibility criteria.

Description

This quiz delves into the different aspects of federal government spending, highlighting mandatory and discretionary spending, entitlements, and programs like Medicaid. It also covers essential concepts like the federal budget and fiscal year. Test your knowledge on how federal funds are allocated and managed.