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Warm-up

What would happen if the Government left road-building up to citizens or private companies? What problems might arise? (list 3). Warm-up. Providing Public Goods Ch 3.3. Public Good.

ishmael-callahan
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Warm-up

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  1. What would happen if the Government left road-building up to citizens or private companies? What problems might arise? (list 3) Warm-up

  2. Providing Public GoodsCh 3.3

  3. Public Good • A public good is a ______ good or service for which it would be __________ or impractical to make consumers pay individually and to _______ nonpayers. • Would you pay a bill for the launch of the space shuttle? Or the cleaning of Mount Rushmore? shared inefficient exclude

  4. Public Goods • The government collects ______ in order to fund projects in the public interest. taxes

  5. National Parks • If a park were _______ owned, the owner could charge admission. Yet some benefits would still be enjoyed by nonpayers. Any number of consumers can use public goods without _______ the benefits to any single consumer. And increasing the number of _________ does not increase the cost. privately reducing consumers

  6. Costs and Benefits • When a good or service is ______ • 1. The benefit to each individual is ____ than the cost that each would have to pay if it were provided ________ • 2. the total _______ to society are _______ than the total cost When the ______ does not provide the good, the ____________ must. public less privately benefits greater market government

  7. Public goods are financed by the public sector, the part of the economy involving the government. • The ______ sector is the part of the economy that involves __________ of individuals and businesses has __________ to produce public goods. private transactions no incentive

  8. Free-Rider Problem • Free rider is someone who would ____ choose to pay for a certain good or service, but would get the ________ of it anyway if it were provided as a public good. • Army helmets, fire protection, roads… Would you pay? Free riders ________ what they do not pay for. This problem suggests that if the government stopped collecting _____ and relied on _________ contributions, many public services would have to be __________. not benefits consume taxes voluntary eliminated

  9. IS airport security a public good? • Before September 11th _______ were responsible for airport security – in Europe the government is responsible…now airplanes are seen as________, thus the benefits go beyond the airline and the ___________ is involved airlines weapons government

  10. Market Failure • A situation in which the market does not ___________________________. • When externalities are present, we have a ____________, because the costs or benefits of a good or service are not assigned properly. distribute resources efficiently market failure

  11. Externality • The __________ side effect of a good or service that generates _____________ to someone other than the person deciding how much to produce or consume • __________ may be positive or negative. economic benefits or costs Externalities

  12. Positive Externalities • Benefit of a good gained by someone who ______ purchase it • Ex. Buy a old beat up house & remodel and beautify the outside • Hire underprivileged teens and train them • Protection of endangered species • Give me 2 more examples did not

  13. Negative Externalities • Cost of producing a good or service is paid for by someone _____ than the producer adding ___________ costs • Ex. Exxon Valdez leaks millions of gallons of oil in the ocean • Your neighbor plays the accordion and holds Friday Polka parties…you hate polka other unintended

  14. Government Goals • Govt tries to _____ negative externalities • Antipollution devices in cars called catalytic converters & EPA to decrease acid rain • Govt encourages _______ externalities • EDUCATION limit positive

  15. Ch 3.4Providing a Safety Net

  16. Poverty • Poverty threshold is when income level is ______ that which is needed to support families or households • The free market system generates wealth but the wealth is spread _______ throughout society. below unevenly

  17. One person (unrelated individual)$10,294   Under 65 years$10,488   65 years and over$9,669 Two people$13,167   Householder under 65 years$13,569   Householder 65 years and over$12,201 Three people$16,079 Four people$20,614 Five people$24,382 Six people$27,560 Seven people$31,205 Eight people$34,774 Nine people or more$41,499 The Census Bureau's poverty thresholds for 2006

  18. Govt Role & Questions • What can the govt do to combat poverty? • What should I do? • Is govt regulation the best way to help the poor? • Does welfare raise poor people’s standard of living?

  19. Welfare System • The government eases poverty by collecting ____ from individuals and __________ some of those funds in the form of welfare. • Welfare is a general term that refers to government ___ for the poor. • The nation’s welfare system began under President ___ after the great depression. taxes redistributing aid FDR

  20. Redistribution Programs • Cash _______ are direct payment of money to the __________________________. • Temporary Assistance for Needy Families • Social Security • Unemployment insurance • Workers Comp Transfers poor disabled and retired people

  21. In-Kind Benefits • Goods and services provided for ____ or at greatly reduced prices • Food Stamps • Subsidized housing • Legal aid free

  22. Medical Benefits • The U.S. provides health insurance for the _______ and the disabled and the poor. • Medicare covers Americans over the age of ___ and the disabled. • Medicaid covers poor people who are __________ or not covered by their employers insurance plans. elderly 65 unemployed

  23. Education • Education add to the nation’s ____________ and labor productivity. human capital

  24. Faith-Based Initiatives • George W. Bush announced an initiative to rely on ______________ support for people in need • He believes that religious organizations are among the ______________ groups delivering social services. • Thus, these organizations will be allowed to _______ for ____________. non-governmental most successful compete federal funds

  25. What do you think is America’s most important feature of the country’s infrastructure?

  26. Teens CASH • Merchants who once saw trouble in teens congregating in front of their stores now see _________, as teens have emerged as an _______ force behind everything from fashion to entertainment to hair care. Today's teens are so different. Kids start making buying decisions ______ than other generations. By the time they are teens they are incredibly _____________________. dollar signs economic earlier sophisticated consumers

  27. Activity • Draft a proposal for a public good that would benefit the students of CHHS • Write a convincing proposal that includes: • Detailed description of the project • A list of the benefits • An analysis of the cost • An explanation of why benefits exceed costs

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