ECON 272

In Class Exercise Fourteen - Say's Law and Fiscal Policy: Government Spending

1.  Explain the concept of opportunity cost with respect to government spending.  Why is it probable that the private sector would use tax money more productively than the government does?

2.  Bastiat's story of the Broken Window Fallacy points out three levels of analysis.  Discuss all three.  The third level explains the unseen - what does that mean?  Explain.

3.  What questions do you still have about this material?