1. Benefits of Free Enterprise
Basic Principles
Profit Motive – trying to improve your well-being
Open Opportunity – anybody can go up or down
Economic Rights
Equality
Private property
Free contracts
Voluntary exchange
Government’s role
Information Flow
Protecting Health, Safety and Well-being
Lots of competition
Not always good for businesses/economy

2. Providing Public Goods
What is a public good? What are examples of public goods? Who pays for them? What is the Free-Rider problem?

3. Externalities
Are there ever side-effects to making an economic decision that affects the people around you?
Externalities can be positive or negative
Government’s role in managing externalities?
Encourage positive externalities – tax incentives
Discourage negative externalities – laws and rules

4. Providing a Safety Net
Poverty threshold in the U.S. for a single parent with 2 kids is $18,498 per year (U.S. Census Bureau 2012)
U.S. Government provides a safety net in the form of cash transfers from better off to less better off
Temporary Assistance for Needy Families
Social Security
Unemployment Insurance
Workers’ Compensation
Other benefits are provided on a non-cash basis
Food assistance
Medical benefits (Medicaid, Medicare)
Education (pre-school, special needs, college assistance)