Using the utilitarian criterion, it is possible that slavery could be in the public interest. a. True b. False ANSWER a
Date: September 9th, 2020
Normative analysis is very important to public finance because _____. a. public policy enacted by government is the result of voting by individuals b. positive analysis is full of value judgments c. we should be concerned with how the world works d. voluntary exchanges are economically efficient ANSWER a
Date: September 9th, 2020
The equilibrium level of regulation is _____. a. determined where marginal political gains to the special interests are equal to the marginal political costs of the foregone regulation b. determined where the marginal benefits from the regulation are equal to the marginal costs of the regulation c. determined where the marginal political benefits to the […]
Date: September 9th, 2020
Government regulators know that pollution is a problem in Cleveland. However, information on the social cost of this externality is difficult to come by. Which of the following statements best describes how this information problem might manifest itself? a. Well-intentioned regulators monitor a handful of polluting factors and are unable to determine how much they […]
Date: September 9th, 2020
If compared against other criteria for evaluating the public interest, the social welfare function is most comparable to _____. a. utilitarianism b. the Pareto criteria c. the potential compensation criterion d. cost-benefit analysis ANSWER a
Date: September 9th, 2020
Positive economic analysis _____. a. evaluates policy changes and determines whether it is a good idea b. seeks to understand the outcome of a policy change c. cannot be proven incorrect d. is a statement about “what ought to be” ANSWER b
Date: September 9th, 2020
The capture theory of regulation states that _____. a. regulators act in the best interests of regulators b. regulators act in the best interests of politicians c. regulators act in the best interests of the general public d. regulators act in the best interests of the regulated ANSWER d
Date: September 9th, 2020
Normative economic analysis _____. a. is concerned only with the facts b. is a statement about the relationship between a policy change an outcome c. judges the desirability of a policy change d. does not involve value judgments ANSWER c
Date: September 9th, 2020
Which of the following statements provides the best description of one reason why regulation of an industry might not increase economic efficiency? a. There are more employees of regulated industries than affected customers. b. Insufficient regulator pay makes it difficult to hire effective regulators. c. The regulated industry has stronger incentives to be involved in […]
Date: September 9th, 2020
Suppose an individual inverse demand curve is given as P = 2 – 1/2 qi, where qi is the quantity demanded by individual i. There are 50 individual consumers with this identical, individual inverse demand curve. Solve for the market demand curve. What will be an ideal response? ANSWER Solve for the individual, regular […]
Date: September 9th, 2020
