ECO 201 case 1

After reading the chapters from the background materials page, please
address the following questions in an essay or short answer form:

 1. Explain the difference between a positive and normative statement.
 Give an example of each type of statement.
 2. How can an economy achieve points that are outside the production
 possibilities curve?
 3. Review the Spillover Principle. Give an example of a good with a
 positive externality and a good with a negative externality (not mentioned
 in the online text). What are the best ways to allocate goods with
 externalities?
 4. Do some research on your own on public goods. What are the two main
 characteristics of this type of good? What is the biggest “problem” with
 allocating public goods? Do you think the government should have a role in
 allocating public goods, or should goods be privatized? Be sure to support
 your answer with references.


Use concepts from the modular background readings as well as any good
quality resources you can find. Please be sure to cite all sources within
the text and in a reference list at the end of the paper.

Length: 4–5 pages double-spaced and typed.
The following items will be assessed in particular:

 - Your ability to apply the basic concepts to the questions.
 - Some in-text references to the modular background readings (APA
 formatting not required).
 - The essay should address each element of the assignment. Remember to
 support your answers with solid references including the case readings.

Case reading: http://www.pearsoncustom.com/mct-comprehensive
/asset.php?isbn=1269879944&id=12310