Applying economics to the real world

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Select two of the three cases presented below and prepare a three-page written analysis of each case (six pages total). These case studies provide real-world application to concepts you have studied during this course.

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Case 1: Government Spending and Taxation

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Read Special Topic 1, pages 404 through 418 of Macroeconomics: Private and Public Choice. You may also want to review Chapters 5 and 6 as the role of the government and the political process were covered in detail.

Using the Government Spending and Taxation case, Chapters 5 and 6, the knowledge you have gained in this course, as well as at least three additional credible resources, analyze the case by addressing the following:

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• Describe how government spending and the composition of the government changed in recent decades. In other words, in what areas has the government cut spending and in what areas has the government increased spending in recent decades?
• Determine if this change in government spending and composition will help Americans achieve a higher living standard. Be sure to support all opinions with research.
• Assess if democracy can survive if the majority of the U.S. citizens pay little or nothing in taxes while benefiting directly from a higher level of government spending. Why or why not?
• Propose the composition of government, government spending, and taxation that you believe would work best. Be sure to be specific and support your proposal with research.

Case 2: The Economics of Social Security

Read the Special Topic 2, pages 419 through 428 of Macroeconomics: Private and Public Choice.

Using the Economics of Social Security case, the knowledge you have gained in this course, as well as at least three additional credible resources, analyze the case by addressing the following:

• Explain how the Social Security system’s basic principles are different from private insurance.
• Determine how Social Security affects the economic well-being of blacks, relative to whites and Hispanics.
• Assess if the current Social Security system promotes income equality. Why or why not?
• Propose how the Social Security system could be modernized to ensure long-term solvency and fairness in distribution. Be specific and support your proposal with research.

Case 3: Keynes and Hayek: Contrasting Views on Sound Economics and the Role of Government (Case 4 in the text)

Read the Special Topic 2, pages 439 through 444. You may also want to review Chapters 11 and 12 of Macroeconomics: Private and Public Choice as the role of government and different views of government intervention were discussed.

Using the Keynes and Hayek: Contrasting Views on Sound Economics and the Role of Government case, Chapters 11 and 12, the knowledge you have gained in this course, as well as at least three additional credible resources, analyze the case by addressing the following:

• Describe briefly how Keynes’s and Hayek’s economic theory and views differ.
• Contrast the two views on how savings may be harmful or beneficial to the economy.
• Compare the two views on whether the economy would fluctuate more or less over the business cycle without government intervention. Be sure to address both the inherent stability of the market economy as well as the impact of government interventions to steer the economy.
• Hypothesize on which economist theory, Keynes or Hayek, you believe is more accurate and why. Be specific and support your hypothesis with research.

Your Cases: Applying Economics to the Real World Final Project

• Must be six to seven double-spaced pages