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By Les Dlabay, James L. Burrow

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Local governments include county boards and city or town councils. Local governments commonly provide services needed for an orderly society, such as police and fire protection. checkpoint ✓ Describe the activities of the three levels of government. ISources of Government Funds Government must have a way to raise money to finance operations and pay wages to its workers. Government income is called tax revenue. Governments obtain a large portion of their revenue through the collection of taxes. In addition, governments raise revenue in other ways.

Government 13. Increased savings will likely cause ? to rise. a. interest rates c. inflation b. borrowing d. exports 14. An example of a current operating expense would be a. a computer c. purchase of land b. a building d. a truck repair 15. Interstate commerce refers to business a. in more than one country b. in more than one state c. within the same state d. in the same city Chapter 1 >>> Review 27 Chapter 1 Assessment Think Critically 16. Inflation rates can be deceptive. Many people face hidden inflation since the cost of necessities (food, gas, health care), on which they spend most of their money, may rise at a higher rate than nonessential items which could be dropping in price.

A building d. a truck repair 15. Interstate commerce refers to business a. in more than one country b. in more than one state c. within the same state d. in the same city Chapter 1 >>> Review 27 Chapter 1 Assessment Think Critically 16. Inflation rates can be deceptive. Many people face hidden inflation since the cost of necessities (food, gas, health care), on which they spend most of their money, may rise at a higher rate than nonessential items which could be dropping in price. Explain how the reported inflation rate could be much lower than the actual cost-ofliving increases experienced by consumers.

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