Government Rolw In A Market Economy Flashcards
1
Q
What are the 8 Government Interventions?
A
- Provide Public Goods
- Correct Market Failures
- Maintain Competition
- Redistribution Income
- Provide for National Defense
- Address Environmental Concerns
- Stabilize the Economy
- Provide a Legal System
2
Q
Correct Market Failures
A
- Positive Externalities: increase utility and productivity (bees pollination)
- Negative Externalities: reduce utility and productivity (pollution)
3
Q
Maintain Competition
A
Regulate Monopolies
4
Q
Redistribution Income
A
Tax those with larger incomes
5
Q
Provide for National Defense
A
- Military and National Guard
- Bases Oversea
- Weapons Programs
6
Q
Address Environmental Concerns
A
Noise and Pollution
7
Q
Provide a Legal System
A
Protect Property Rights
8
Q
Why does the U.S. play a Limited Role in economic intervention?
A
Most goods and services can be freely and effectively produced in the private section
