12th Grade AP Microeconomics Summer Reading:

  1. Read chapter 1 in Mankiw’s Principles of Economics, and answer the “questions for review” at the end of the chapter (page 16). There are 10 questions (Note: these are not the problems and applications). You may hand write these answers.
  1. Read Freakonomics: A Rogue Economist Explores the Hidden Side of Everything by Steven Levitt.

1)Levitt claims that the book has no unifying theme, but when you read Freakonomics, you will learn that he strongly believes that incentives matter. Define “incentive” in your own words. Also, explain the term using at least one personal example. Why are incentives important not only to you personally but also more generally in economics?

2)Levitt also argues that with sufficient data and good enough questions, one can analyze any issue. After reading the book, do you agree with this thesis? Explain why or why not using examples from the text.

3)Levitt has been accused of many things as a result of writing this book ranging from being a brilliant economist, to someone who can only ask strange questions, to being a racist pig, to being a harmless hack. Pick the description that best describes him in your own mind, and use evidence from the book to support your position.

4)Does Levitt prove causation or only correlation in his examples? Define both terms. Support why you believe he has either demonstrated correlation or causation or some combination of the two using 3 examples from his text.

Turn in these assignments the first week of school. You should type your Freakonomics paper (double spaced, 12 font).. Make sure you cite evidence by referring specifically to the text. Because you are only using one text, you may simply put the page number of your citation in parenthesis at the end of the relevant sentence. Remember that you should also cite any information you find online about this book (Yes, there is a dedicated website with a summary of the book. Now that you know that I know, you should have every incentive to do your own analysis)

The project will be worth 10% of the semester grade.

Summer contact information:Dr. Graeber’s email and cell phone (310) 872-7517. I will be out of the country between June 18 and July 2.