Discussion:
1. Define and discuss circumstances where governmental interference in the market process may be necessary. Specifically define and discuss externalities-both positive and negative.
2. Define "public goods" and provide examples with an explanation of why these examples qualify as public goods. How can government account for these in public policy?
3. Discuss the concept of comparative advantage and how it relates to the benefits of international trade. Describe some trade restrictions that exist in the real world and evaluate their possible impacts on consumer welfare and prices and producer prices and profits.