Unit 5: The Role of Government
The following topics will makeup approximately 12-18% of the multiple choice questions on the AP Exam.
After completing this unit you must be able to:
- Understand the difference between public and private goods. (5-1)
- Explain why public goods are important, and why private firms don't profit from making them. (5-1)
- Understand basic anti-trust policy and the government attempts at regulation. (5-2)
- Explain positive and negative externalities and give examples of each. (5-2)
- Define and understand marginal social benefit and marginal social cost. (5-2)
- Define and differentiate between progressive, proportional, and regressive taxes. (5-3)
- Use the Lorentz curve and Gini coefficient to measure the equality of income distribution. (5-3)
Unit 5 Documents
These documents will be provided at the beginning of each unit. If you lose them it is your responsibility to reprint the necessary pages.