Beyond the Sound Bites (if time after Quiz):
Clear your desk except for a pencil. Once everyone is quiet, and no talking during the Quiz, we can begin. Be sure to put your name on the Quiz and the Scantron. You may write on both the Quiz and the Scantron.
If you finish early, you may take out non-class materials; once everyone is finished, put away the non-class materials. Then, I will collect the Scantron first, and then I will collect the Quiz.
Be sure your name is on both the Scantron and the Quiz.
If your name is not on the Quiz it will not be returned.
The Ch. 5 Sec. 1 Quiz is today.
The Ch. 5 Sec. 2 Quiz is on Thursday.
The Ch. 5 Sec. 3 Quiz is on Friday.
Skip #16 and #35; do not answer on the Test.
The Chapter 4 Test Make-up is today.
Cf. http://shanawiki.wikispaces.com/Honors+Business+Economics+Chapter+4+Test+Prep+Page+Spring+2011
The Ch. 4 Sec. 3 Quiz Make-up is today.
Standard feature:
The electronic edition of the Philadelphia Inquirer is available. We have the Sunday edition, available on Mondays, in addition to the Tuesday through Friday editions on the other days.
Please follow the steps below:
URL: http://nie.philly.com
Click on the words "Access e-Inquirer" located on the gray toolbar underneath the green locker on the opening page.
Login:
Username: bshsinky@shanahan.org
Password: 10888
Scott Says NYSE Sale Shows U.S. Losing Competitiveness
http://www.youtube.com/watch?v=Qa96e3YkgUU
Feb. 15 (Bloomberg) -- Hal Scott, a professor at Harvard Law School, talks about Deutsche Boerse AG's agreement to buy New York Stock Exchange parent NYSE Euronext in a $9.53 billion all-stock deal. He speaks with Scarlet Fu on Bloomberg Television's "InBusiness." (Source: Bloomberg)
Mulvaney to Obama Budget Director: Not Credible
Think you might have good ideas on how to balance the federal budget? Well, now’s your chance to solve it! With this budget simulation from The New York Times, you can peruse a menu of possibilities for cutting spending or raising taxes. As you select each item, the interactive feature shows how much money will be saved in both short-term and long-term forecasts.
The idea is pretty simple: read each issue along with its brief description underneath, and if you think, “yeah, let’s cut that,” check the box. When an item is selected, the gray boxes at the top (each representing $1 billion) will turn to blue. The goal is to cut enough spending and/or raise enough taxes to balance the federal budget by both 2015 and 2030.
Today, you’re in charge of the nation’s finances. Some of your options have more short-term savings and some have more long-term savings. When you have closed the budget gaps for both 2015 and 2030, you are done. Make your own plan, then share it online.
Cf. http://glencoe.mcgraw-hill.com/sites/0078747643/student_view0/unit2/chapter7/
Chapter 7: Market Structures
Section 2: Market Failures
Introduction to Market Failure
When does a market failure occur?
The mnemonic device may aid your memory.
Remember: PIMM FACED
Define each of the following parts of the mnemonic.
P-ublic good
I-nequality
M-erit good
M-onopoly
F-actor Immobility
A-griculture
C-yclical Instability
E-xternality
D-emerit Good
Public Goods
What are private goods?
Define excludibility.
Define rivalry.
What are public goods?
Define nonrivalry.
What example illustrates a public good?
Who pays for a public good?
What is free ridership?
What is the government's role?
What happens when you can't prevent people from consuming a commodity, even if they haven't paid for it? Who ends up providing these kinds of goods and services?
externality
In-class assignment, with a partner, answer the following questions.
When do externalities occur?
What do they involve?
What is involved in negative externalities?
What does the example of a cell phone demonstrate?
Are there any costs to others when a cell phone is used while driving?
Do users consider all the costs?
What entity is involved as a result?
What is the government solution to negative externalities?
What about positive externalities?
What field is an example of positive externality?
What is the government solution to a positive externality?
Externalities, 7:39
negative externality
positive externality
Academic Vocabulary
Ch. 7 Sec. 2 Reading Strategy
In-class assignment, with a partner, complete the graphic organizer about why maintaining adequate competition is a worthwhile goal. Use the graphic organizer to list some of the effects of competition.
Enron
enron the smartest guys in the room - Trailer, 2:04
In-class assignment, with a partner, answer the following.
What was Enron's fatal flaw?
How would you characterize the type of people at Enron?
What did they find to make a profit?
What is the corporate crime of the century?
Types of Market Failures
Market Failures, 3:13
What is the definition of a market failure?
What are externalities?
Recall the cell phone example from externalities.
What is the second type of market failure?
What are two examples?
What is the next type of market failure?
What is one example?
What is the fourth type of market failure?
What is one example?
Inadequate Competition
Inadequate Information
Resource Immobility
Did You Know?
Expensive Memories
Sherman Antitrust Act
Public Goods
Externalities
Reading Check
Analyzing
What type of market failure do you think is most harmful to the economy?
Dealing With Externalities
Correcting Negative Externalities
Correcting Positive Externalities
Reading Check
Explaining
If externalities are positive, why should they be corrected?
BusinessWeek Newsclip
Lord of the Rings
Ch. 7 Sec. 2 Review
In-class assignment, with a partner, use the graphic organizer to identify and describe both types of externalities.
Section 3 The Role of Government
The role of government has expanded to preserve competitive markets. This has taken the form of antitrust legislation that outlaws trusts and various forms of price discrimination. As a result, the economy has been modified so that it is now a mixture of different market structures, different forms of business organizations, and some degree of government regulation.
Content Vocabulary
trust
price discrimination, 3:59
In-class assignment, with a partner, answer the following.
What does price discrimination mean?
Does a firm charge different prices for the same product?
Why (in an economic phrase) can they do this?
Explain the role of marginal revenue in price discrimination.
Why would a firm split their market like this?
(The practice can not be done if it lessens competition--cf. Clayton Antitrust Act)
http://www.youtube.com/watch?v=4NNGP9gWnSg
cease and desist order
public disclosure
Academic Vocabulary
Ch. 7 Sec. 3 Reading Strategy
In-class assignment, with a partner, complete the graphic organizer by describing how governments try to avoid market failures.
Products in the News
Electric Bass Recalled
Maintain Competition
Antitrust Legislation
Government Regulation
Do Government Regulations Actually Help Big Business? - Tim Carney, 4:26
Tim Carney, Cato Enterprise Institute's Warren T. Brookes Journalism Fellow, is the author of The BIG Ripoff: How Big Business and Big Government Steal Your Money (Wiley, 2006).
He was a 2004-2005 Phillips Foundation Journalism fellow, and before that he was a political reporter for Bob Novak and Assistant Editor at Human Events. He is a columnist for America's Future Foundation's webzine Brainwash, and is a contributing editor to Human Events.
Reading Check
Describing
Why are some government regulations beneficial for consumers?
Improve Economic Efficiency
Promote Transparency
Provide Public Goods
The Rahn Curve and the Growth-Maximizing Level of Government, 5:43
When does providing public goods increase economic performance?
What happens if government spending increases too much?
Does this reduce prosperity?
What do scholars generally conclude that economic performance is maximized? Between what percentage of GDP?
What other policies also impact growth?
Most nations in Europe and North America had large or modest (small) levels of government for most of their history?
What can we say for sure?
Reading Check
Interpreting
What negative things could happen in a market without disclosure?
Modified Free Enterprise
Reading Check
Summarizing
Why do we use the term modified to describe the American free enterprise economy?
Ch. 7 Sec. 3 Review
In-class assignment, with a partner, use the graphic organizer to identify how the federal government can maintain competition and improve economic efficiency.
Case Study Pixar and Disney
References
Ch. 5 Prep
Chapter 5 Supply Multiple Choice Quiz
Cf. http://glencoe.mcgraw-hill.com/sites/0078747643/student_view0/unit2/chapter5/self-check_quizzes.html
Chapter 5 Puzzle
Cf. http://www.glencoe.com/olc_games/game_engine/content/gln_ss/epp_08/ch05/index.html
Chapter 5 Supply Flashcards
Cf. http://www.glencoe.com/qe/efcsec.php?qi=15424
Ch. 6 Prep
Chapter 6: Prices and Decision Making
Multiple Choice Quiz
Cf. http://glencoe.mcgraw-hill.com/sites/0078747643/student_view0/unit2/chapter6/self-check_quizzes.html
ePuzzle Concentration
Cf. http://www.glencoe.com/olc_games/game_engine/content/gln_ss/epp_05/chapter06/index.html
Academic, Glossary, People/Places/Events
Cf. http://www.glencoe.com/qe/efcsec.php?qi=15429
Jaco Pastorius bass Solo at Live under the sky 1984, 4:18
Pat Kilbride Bass Solo (Paul Delong Drum Solo) on "Nothing Personal," 3:00
Email (or hand in hard copy) to gmsmith@shanahan.org.
Wednesday HW
1. p. 171, What is the difference between marginal cost and marginal revenue at the quantity of 129?
2. p. 171, What would happen if the firm in the graph tried to charge a price greater than $15?
3. p. 171, Use your own words to summarize the reasons why perfect competition keeps prices low.
