occurs when the beneficiaries of goods with positive externalities do not pay for
those goods.
- one of the key economic roles of govt is to reduce this
- this is why these goods are typically supplied or subsidized by the govt.
- this is also why your taxes are not voluntary
Give this one a try later!
Free Riding
a price index derived from real and nominal GDP
GDP Deflatort = (Nominal GDPt/Real GDPt) x 100
t - is the year
This will give you a slightly different inflation estimate from that derived from the CPI,
,but...
for our purposes, the difference is not significant, and we will focus on the CPI
Give this one a try later!
The GDP Deflator
In modern political discourse, such as the current presidential races, some goods with
externalities - e.g. transportation projects - are referred to as "_______."
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Infrastructure
As we've seen, goods with positive externalities tend to be under produced by the
free market, so govts typically step in to supply or subsidize them.
Many enhance economic output and so offset the deadweight loss from taxation.
- Education
- Transportation
- Criminal justice
Give this one a try later!
Economic Role of Government
What is the easiest tax to analyze? Why?
Give this one a try later!
, Excise Tax
- because it's a per unit tax
The economic (as opposed to the political) issue with taxation is not one of "high
taxes" or "high tax rates" vs. "low taxes" or "low tax rates".
Rather, the questions are: On what are your tax revenues being spent?
And, do those expenditures increase or decrease economic activity?
Give this one a try later!
Taxation: Conclusion
However, they are on course to consume the federal budget.
In the next 5-7 years these items are projected to consume roughly 60% of federal
spending (CBO, 49).
If you add interest on the national debt, you're at roughly 75%.
Give this one a try later!
Problem w/ Borrowing
1 of 2 Main Branches of Macroeconomics:
concentrates on central banking - e.g. the Federal Reserve System (Fed, for short),
the money supply, and interest rate policy
Give this one a try later!
those goods.
- one of the key economic roles of govt is to reduce this
- this is why these goods are typically supplied or subsidized by the govt.
- this is also why your taxes are not voluntary
Give this one a try later!
Free Riding
a price index derived from real and nominal GDP
GDP Deflatort = (Nominal GDPt/Real GDPt) x 100
t - is the year
This will give you a slightly different inflation estimate from that derived from the CPI,
,but...
for our purposes, the difference is not significant, and we will focus on the CPI
Give this one a try later!
The GDP Deflator
In modern political discourse, such as the current presidential races, some goods with
externalities - e.g. transportation projects - are referred to as "_______."
Give this one a try later!
Infrastructure
As we've seen, goods with positive externalities tend to be under produced by the
free market, so govts typically step in to supply or subsidize them.
Many enhance economic output and so offset the deadweight loss from taxation.
- Education
- Transportation
- Criminal justice
Give this one a try later!
Economic Role of Government
What is the easiest tax to analyze? Why?
Give this one a try later!
, Excise Tax
- because it's a per unit tax
The economic (as opposed to the political) issue with taxation is not one of "high
taxes" or "high tax rates" vs. "low taxes" or "low tax rates".
Rather, the questions are: On what are your tax revenues being spent?
And, do those expenditures increase or decrease economic activity?
Give this one a try later!
Taxation: Conclusion
However, they are on course to consume the federal budget.
In the next 5-7 years these items are projected to consume roughly 60% of federal
spending (CBO, 49).
If you add interest on the national debt, you're at roughly 75%.
Give this one a try later!
Problem w/ Borrowing
1 of 2 Main Branches of Macroeconomics:
concentrates on central banking - e.g. the Federal Reserve System (Fed, for short),
the money supply, and interest rate policy
Give this one a try later!
