Vocab
collection of people who try to influence government in ways that benefit its members
interest group
allows economic mobility
open opportunity
Which of the following actions might a free market gov't take to encourage the development of new technology?
a. invest in more technological training for the public
b. prohibit companies from using new technology
c. require business leaders to increase their use of technology
d. discourage use of technology by taxing new inventions
a. invest in more technological training for the public
When the total benefits to society are greater than the total financial costs, it becomes this
a public good
government aid "to the poor" (but it really benefits everyone)
welfare
right of the government to take private property for public use
eminent domain
Which characteristic of American free-enterprise allows everyone to compete in the marketplace
legal equality
Gives the inventor of a new product the exclusive right to produce and sell it
patent
Basic facilities needed for a society to function
infrastructure
the concerns of society as a whole
public interest
money given by gov't agency to carry out a task
grant
The government forces businesses to make buyers more knowledgeable and safer through
public disclosure laws
a period of economic growth followed by a period of contraction is a
business cycle
A new runway has opened up at the airport, and citizens complain to local officials that the noise of the airplanes is disturbing their neighborhood. The noise is an example of a
Give an example of a free-rider problem
Answers will vary but must demonstrate a scenario where someone gets to consume a good/service even though they didn't pay for it
economic side effect of a good or service
externality
Which characteristic of free enterprise gives incentive to conserve resources
private property
the study of economic behavior and decision-making in a nation's whole economy
macroeconomics
public sector
Give an example of a positive externality
Answers will vary but must show that the benefit is assigned to someone OUTSIDE of the producers and consumers of the good/service
situation where the free market alone cannot distribute resources efficiently
market failure
voluntary exchange
What might a government do to make the economy stronger and more efficient?
Promote progress in technology
give grants
Give an example of a public good
Answers will vary but must describe something that benefits society that the gov't pays for
Ex: highways, schools, parks, police/fire dept, etc.
Give an example of a market failure
Answers will vary but must be a scenario where private companies aren't able to distribute resources efficiently for society as a whole
Ex: Private company Big Road Inc. is put in charge of building and running a state's entire road system. The company charges high fees to use its roads and only maintains them in heavily populated areas