Тне american economy (part II)

Tertiary economic activities involve the output of services rather than goods. Examples of tertiary activities include wholesale and retail trade, banking, government, and transportation.

Service industries account for 7S percent of the US gross domestic product and employ 76 percent of the country's workers. This industry group includes а wide variety of businesses that provide services rather than producing goods.

Community, social, and personal services rank first among U.S. service industries in terms of the gross domestic product. This industry includes such establishments as doctors' offices and private hospitals, hotels, law firms, computer programming and data processing companies, restaurants, repair shops, private research laboratories, and engineering companies.

Finance, insurance, and real estate rank next among U.S. service industries. Banks finance much of the economic activity in the United States by making loans to both individuals and businesses. American banks loan billions of dollars annually. Most of the loans [о individuals are for the purchase of houses, automobiles, or other major items. Bank loans to businesses provide an important source of money for capital expansion the construction of new factories and the purchase of new equipment. As а business expands, it hires more workers. These workers, in turn, produce more goods and services. In this way, the nation's level of employment and its economic output both increase.

Other important types of financial institutions include commodity and security exchanges. Commodities аrе basic goods, such as grains and precious metals. Securities are certificates of investment, such as stocks and bonds. The prices of commodities and securities are determined by the buying and selling that takes place at exchanges. The New York Stock Exchange is the nation's largest security exchange. The Chicago Board of Trade is the world's largest commodity exchange.

The United States has the world's largest private insurance industry. The country has about 2,000 life and health insurance companies and about 3,500 property and liability companies. Real estate is important tо the economy because of the large sums of money involved in the buying and selling of property.

Wholesale and Retail Trade play major roles in the American economy. Wholesale trade, which includes foreign trade, takes place when а buyer purchases goods directly from а producer. The goods may then be sold to other businesses for resale to consumers. Retail trade involves selling products to the final consumer. Grocery stores, department stores, and automobile dealerships are examples of retail trade establishments.

Foreign trade provides markets for surplus agricultural goods and many raw materials and manufactured goods produced in the United States. The nation imports goods that it lacks entirely or that producers do not supply in sufficient quantities. It also imports goods produced by foreign companies that compete with U.S. firms. During much of the country's history, the value of U.S. exports has exceeded, or been about the same as, the value of its imports. But since the mid-1960's, the value of imports has usually been much higher than the value of exports.

Important U.S. exports include (1) machinery and transportation equipment, such as aircraft, computers, electric power equipment, industrial machinery, and motor vehicles and parts; (2) manufactured articles, especially scientific measuring equipment; (3) chemical elements and compounds, including plastic materials; (4) basic manufactures, such as metals and paper;(5) agricultural products, especially corn and wheat.

The leading U.S. imports are (1) machinery and transport equipment, such as automobiles and parts, engines, office machines, and telecommunications equipment; (2) manufactured articles, such as clothing, shoes, and toys; (3) mineral fuels and lubricants, especially petroleum; (4) basic manufactures, such as iron, steel, and other metals, and paper and newsprint; and (5) chemical products, such as chemical compounds and medicines.

Canada and Japan are the country's chief trading partners. Other major U.S. trading partners include Germany, Mexico, South Korea, Taiwan, and the United Kingdom.

Government services play а major role in the economy. Federal, state, and local governments employ 17 percent of U.S. workers. Many government employees are directly involved in making public policies. Others — including police officers, postal workers, teachers, and trash collectors — provide public services.

Federal, state, and local governments buy а fifth of all the goods and services produced in the nation. These purchases range from paper clips to office buildings. The federal government is the nation's largest single buyer of goods and services. Its agencies, including the military, buy billions of dollars worth of equipment from private companies. In addition, federal grants finance much of the nation’s research activity. State governments spend most of their income on education, health care and hospitals, highways, and public welfare. Local governments spend over а third of their income on education, and less for police and fire protection, hospitals, streets, sanitation and sewerage, and parks.

In addition to its roles as an employer and purchaser of goods and services, government influences the economy by providing income to certain groups of people. For example, the federal government makes social security payments to retired and disabled persons. Federal, state, and local governments provide welfare assistance to the needy. Such government programs are the only source of income for some Americans.

Transportation and communication are also important to the economy. Railroads rank as the leading freight carriers, handling more than 35 percent of the freight. Trucks carry nearly 25 percent of the freight. About 15 percent of the freight traffic travels on waterways. Airlines handle less than 1 percent of the freight traffic.

Private corporations operate the publishing and broadcasting industries in the United States. Publishers in the United States issue about 8,600 daily, weekly and semiweekly newspapers, which have а total circulation of more than 60 million copies. The newspapers provide information on local, national, and international events. Many also include such special features as opinion columns, articles on health and fashion, and comic strips and crossword puzzles. Most newspapers serve а local region. But The Wall Street Journal, USA Today, The New York Times, and The Christian Science Monitor circulate to most of the country. The Wall Street Journal, which specializes in business news, has the largest circulation among U.S. papers.