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Chapter 2

Chapter 2 . Sec 4. Mixed Economy. Centrally planned Economy are cumbersome. Traditional Economies have little potential for growth and change. Laissez Faire. Gov’t generally should not intervene in the market place Leave it alone. Adam Smith.

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Chapter 2

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  1. Chapter 2 Sec 4

  2. Mixed Economy • Centrally planned Economy are cumbersome. • Traditional Economies have little potential for growth and change

  3. Laissez Faire • Gov’t generally should not intervene in the market place • Leave it alone

  4. Adam Smith • Left alone the free market would provide the greatest benefits and raise the standard of living. • Believed that there always should be a certain level of gov’t intervention • To help answer the some of the wants and needs questions.

  5. Adam Smith cont. • Some needs are met by the gov’t • Education • Walfare • Mass transit • Law enforcement • Protection of New Products • Laws to encourage competition

  6. Private Property • Property controlled by individuals/companies not by the federal gov’t • Laws protecting the property rights….

  7. Balancing control and freedom • Some goals are met by open markets and some are better off ran by the gov’t.

  8. Government in Factor Market • Gov’t purchases FOP from households • Employs 2.8 Mill people for their labor • SITE • Building roads

  9. Transferring money • Gov’t collects $ • Given back for FOP • Greatest expenditure in the USA is Social Security

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