Management Assignment

Answer TWO of the following questions. It should generally require no more than a page for each answer. Cite your sources, and if you include quotes from the textbook (attached) or other sources, keep them short (most of all I want your words on these topics).

1. The production, sale, or use of some goods may be accompanied by negative externalities (or spillovers), and that of other goods by positive externalities. Explain what this means, and describe (with examples) possible government responses to positive and negative spillovers.
2. What are the aims of the distribution function of government? How does the ‘leaky bucket’ problem constrain redistribution?
3. How do the Congressional authorization and appropriation procedures for federal mandatory spending differ from the procedures for discretionary spending? Give examples of each category of spending. Why is it harder to control the growth of mandatory spending?
4. How does government in the United States today compare to a century ago, in terms of (a) the relative importance of federal, state, and local government, (b) the overall size of government, (c) the dominant functions of government, (d) the likelihood that federal budgets are balanced, and (e) the composition of federal spending?
5. Why is it appropriate for state and local governments to borrow to finance their long-term capital spending, but not appropriate to borrow to pay for current operating expenses?

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