AP ECONOMICS 
                           SUMMER ASSIGNMENT 
         
      Your summer assignment consists of two parts: reading a book entitled Naked Economics (don't get too excited....), 
      and listening to or reading segments from the radio programs or podcasts on economic topics. 
         
      PART I: Naked Economics 
       
      Naked Economics: Undressing the Dismal Science 
      Author: Charles Wheelan 
      Publisher: W.W. Norton and Co. 
      Revised and Updated Edition (April 2010) 
      ISBN: 978-0393337648 
       
      Naked Economics provides an interesting and easy-to-read introduction to many economic concepts that we will 
      cover in more depth during the year. In fact, you may find the book far more interesting than the class itself! :) 
       
      While reading the book, please answer the following questions. Most of the questions don't require lengthy 
      answers; focus on the point of the question. However, you should answer all questions in complete sentences.  If 
      you quote from the book, make sure to use quotation marks and cite appropriately. You are also expected to write 
      your own answers to the questions and not to collaborate with any other student on this assignment.  
       
      Answers to questions #1-11 are due on July 15th. Put your answers into a document on Google Drive. Entitle 
      the document, Yourlastname_NE_Pt 1, and share the document with me. 
       
      Answers to questions #12-31 are due on August 15th. Follow the preceding instructions, entitling your 
      document, Yourlastname_NE_Pt 2. 
       
        PART I: 
        1.  What fundamental economic precept is indicated by the example of Coca-Cola and East Germany? 
        2.  What is the economic concept of utility? 
        3.  What does the economic concept of cost mean? 
        4.  According to what economic principle do firms operate? 
        5.  Why are gas stations in South Africa cleaner? 
        6.  What is the free rider problem? 
        7.  What is the principal-agent problem? 
        8.  What is creative destruction? 
        9.  Explain what role the government can play in a market economy when dealing with externalities. 
        10. Why is it important for the government to establish property rights and effective institutions? 
        11. Explain briefly why human capital and productivity are so important to economic well-being. 
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        PART 2: 
        12. How do financial markets differ from Las Vegas? 
        13. What does economics explain about the politics of special interest groups? 
        14. What is GDP?  What is the difference between nominal GDP and real GDP? 
        15. What are some of the causes of recessions? 
        16. What is fiscal policy? 
        17. What is Okun’s Law? 
        18. What is the current account surplus and current account deficit? 
        19. Explain why the Federal Reserve is such a powerful institution. 
        20. Explain what the functions of money are. 
        21. What gives the dollar its value? 
        22. What are some of the harmful effects of inflation? 
        23. What is deflation?  Why is it not a positive phenomenon? 
        24. Why do we trade with others? 
        25. How can we offset some of the negative results of globalization? 
        26. Explain how globalization positively impacts poor developing nations.   
        27. What is the primary economic reason why sweatshops pay low wages? 
        28. Explain some of the factors that contribute to the wealth and poverty of different nations. 
        29. Explain why property rights are an important factor in economic development. 
        30. What is brain drain? 
        31. Explain why sound and effective government policies are often associated with successful foreign aid. 
       
       
      PART II: Economics Radio/Podcasts 
       
      There are several good radio programs and podcasts that deal with economic topics. One of my favorites is 
      Marketplace, a half-hour radio program from American Public Media. It airs brief reports on various aspects of the 
      current economy, and most are informative, interesting, and easy to understand. In this area, it can be heard 
      regularly on radio station WNYC, 93.9 FM, weekdays at 6:30 PM. However, you are not limited to listening to it at 
      that time: MP3 versions, podcasts, and written transcripts are all available at the website: 
      http://marketplace.publicradio.org/  
       
      If you use the website, you can use material from any of the related programs listed: Marketplace, Actuality, The 
      Uncertain Hour, Codebreaker, Conversations from the Corner Office, Marketplace All-in-One, Marketplace Morning 
      Report, Marketplace Tech, Marketplace Weekend, Marketplace Wealth & Poverty.  
       
      Other excellent radio programs/podcasts are produced by Freakonomics (freakonomics.com - I'm a big fan of the 
      host, Stephen Dubner), and Planet Money (at www.npr.org/sections/money). I highly recommend both of them. 
       
      For this part of your summer assignment, you must listen to (or read the full transcript of – not just a summary!) one 
      economics program or podcast per week during the months of July and August. Although you can include some 
      "fluff" pieces, make sure that most of the pieces you write about are more serious. After listening or reading, you 
      must write a 5-10 sentence summary (no longer!) of the piece.   
       
      Collect all your summaries in one document on Google Drive. Make sure that each summary begins with the title of 
      the piece so that I can find the original on the website if I want to. Entitle the document, Yourlastname_Podcasts. 
      Be sure to share it with me. 
       
      Share the summaries with me by August 31st. 
      _____________________________________________________________________ 
       
      If you have any questions about the assignment, feel free to email me. I will be checking my school email every few 
      days over the summer.  
       
      I hope you have a great summer (despite this assignment!) –  
       
      Ms. Curry