Introduction

While there are many different countries with many different economic systems, this unit will focus on the role the United States government plays in regulating the nation's market economy.

Lesson Objectives

Following successful completion of this lesson, students will be able to:

  • explain the need for government intervention in a free market system.
  • describe why the government discourages the production of goods that produce negative externalities.
  • describe why the government encourages the production of goods that create positive externalities.
  • identify the difference between a public and private good.
  • explain the importance of the government enforcing laws, promoting competition in a free market economy.
  • analyze the economic functions of government in a market economy.

The above standards correspond with the Alabama Course of Study: Economics objective(s): 4, 4.1.