1. Economic Systems Economics Goals Articles Lecture Agenda
Naked Economics Chapter 6
Review
Economic Systems
Economics Goals
Articles
Quiz … open note
The US Economy
Lecture
Homework
Review Powerpoint for next class (online)
Read “Current Reading Assignment” online – The Moral Case for Capitalism (C:\Documents and Settings\SHaderlein\Desktop\summer 2012 articles\The Moral Case for Capitalism.mht)
Test # 1
Period 2 – September 6
Period 6 – September 10
Period 7 – September 10
REMEMBER…Extra credit for the class if everyone attends test day!

2. Naked Economics, Chapter 6
Five minute review
Writing Assignment to follow

3. No need to restate the question
Naked Economics, Chapter 6 Writing Assignment
What is a significant point of the chapter?
What is an example of that point?
What is an example of that significant point from our discussions?
Bullet points are fine
No need to restate the question
Graphs are good

4. Economic Systems, Questions and Goals
Societies organize themselves within different systems to allocate resources to produce goods and services to achieve economic goals
3 Economic Three Economics Systems
Questions Free Mixed Centrally Planned
Market Economy Economy
What gets Consumers role Government
Produced?
for
How it gets Producers Government
Produced? individuals
Who Income and Government
Consumes?
government 4

5. Continuum of Mixed Economies Centrally Planned to Free Market
Source: 1999 Index of Economic Freedom, Bryan T. Johnson, Kim R. Holmes, and Melanie Kirkpatrick
Iran
North Korea
Cuba
China
Russia
Greece
Peru
United States
South Africa
France
United Kingdom
Botswana
Canada
Singapore
Hong Kong
1999? What’s happened since with the US and with China since then? What has that achieved?

6. Quotes … The only freedom worth a damn is economic freedom.
M.L. Meinken, author
Hunger is the stuff of which dictators are made.
Franklin Delano Roosevelt

7. Econ Cartoon!

8. Article What’s the real argument going on here? Freedom vs. Equity
Inequity
What’s the real argument going on here?
More government involvement or less government involvement

9. Video…Economic Freedom

10. Quiz
Key Terms
Economic Goals, Systems, and Questions

11. Quiz Key Terms Economic Goals, Systems, and Questions
Cheat and you die

12. Quiz Key Terms Economic Goals, Systems, and Questions
Cheat and you get a zero
Remain Quiet 12

13. THREE MINUTE BREAK

14. Introduction to the US Economy

15. The US Economy
What type of economic system is the US?

16. The US Economy
What type of economic system is the US?
Mixed Economy…some government and some individuals

17. Key terms Market Failure Public Goods Free Rider Transfer Payments
Externalities

18. Key terms Market Failure Public Goods Free Rider
The free market fails to provide the good or service desired by society…the “market failed”
Example: A park
Public Goods
Government provided good or service (i.e. parks, libraries, roads, fire department).
Solves the market failure
Free Rider
Uses the public good but did not pay the taxes for the public good

19. Key terms Transfer Payments Payments by the Government
Can be cash or in kind (non-cash) payments
Examples
Cash Payments – Social Security, Unemployment benefits
In Kind – Food stamps, healthcare 19

20. Why does the government provide Public Goods and Transfer Payments?
Achieve Equity and Security
CONNECTION?...Government does the Equity and Security Goals

21. Externalities
Event that affects you
but you had no control over it

22. but you had no control over it
Externalities
Event that affects you
but you had no control over it
Can be Positive or Negative
not the same as “good” and “bad”

23. but you had no control over it
Externalities
Event that affects you
but you had no control over it
Can be Positive or Negative
not the same as “good” and “bad”
Examples
New Park
Hurricane

24. A couple questions…. 1. The United States economy is a mixed economy
(a) based on the principle of a traditional economy, but allows some government intervention.
(b) based on the principles of a centrally planned economy, with limited government intervention.
(c) based on the principles of the free market, and allows no government intervention.
(d) based on the principles of the free market, but allows some government intervention.
2. Government intervention in a modern economy is useful because
(a) the needs and wants of modern society are always met by the marketplace.
(b) the marketplace has many incentives to create public goods such as parks and libraries.
(c) governments are able to provide some goods and services that the marketplace has no incentive to produce.
(d) the marketplace provides all of its own laws.

25. Homework Print and Review Powerpoint for next class
Read “Current Reading Assignment”

26. Test # 1 Key Terms Production Possibilities Curve
Economic Goals, Systems, and Questions
The US Economy
Period 5 – January 29
Period 6 – January 29
Period 7 – January 30
REMEMBER…Extra credit for the class if everyone attends test day!
REMEMBER…January 27 is Senior Service Day

27. HANDOUTS