1. Government and the Economy Fall-Winter 2013 Harrison Career Center Mr. Leasure

2. Government and the Economy Objectives 1.I will be able to explain how the government regulates economic activity. 2.I will be able to describe the business cycle. 3.I will be able to identify the reasons for economic inequality.

3. The Role of Government

4. The Role of Government Student Objectives 1.I will be able to identify the public goods the government provides. 2.I will be able to identify the actions the government can take to regulate economic activity.

5. The Role of Government Key Terms 1.Private Goods – Goods that, when consumed by one individual, cannot be consumed by another individual. 2.Public Goods – Goods that can be consumed by one person without preventing the consumption of the good by another. 3.Externality – The unintended side effect of an action that affects someone not involved in the action.

6. The Role of Government Key Terms 4.Anti-Trust Law – Laws to control monopoly power and to preserve and promote competition. 5.Merger – A combination of two or more companies to form a single business.

7. The Role of Government Key Terms 6.Natural Monopoly– A market situation in which the costs of production are minimized by having a single firm produce the product. In exchange for having the market all to itself, the firm agrees to be regulated by the government. 7.Recall – When a company pulls a product off the market or agrees to change it to make it safe.