Economics – 4/28/14

I.  Bellwork Q&A

 Chapter 7 - China Smog

  1. What is happening in the picture?
  2. Who is impacted?
  3. How are they impacted?
  4. Why do you believe this is being allowed?

II.  Objective:

  • Identify common circumstances related to market failures and the impact externalities have on society.
  • Evaluate various explanations for actions or events and determine which explanation best accords with textual evidence

III.  Retakes tomorrow @ 2:30 in G204 (Retakes bring 3 paragraphs for section summaries)

IV.  Video & Discussion

  1.   Notebook Work/Discussion:
  • Causes of Market Failures-Pgs 180-181-Create a Tree Map
  • Distinguish between a positive and negative externality
  • Identify methods the government uses to discourage negative externalities and encourage positive externalities

VI.  Classwork

a) What is the negative externality and why is it a negative externality?
b) Comment on the likely success of different approaches to solve the problem and reduce the market failure

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