By polling people, we can calculate the demand for public goods and have the market provide them. But we don't. Instead, we allow the government to pay for and provide those goods because it
a. knows better than individuals what public goods are desirable
b. avoids "special interests" interference in the market
c. can avoid all negative and positive externalities
d. can tax people to finance the production of public goods and thereby prevent freeriders
e. can prevent market failure
D
You might also like to view...
In the long run, perfectly competitive firms produce at the output level that has the minimum
A) marginal cost. B) average total cost. C) average variable cost. D) average fixed cost. E) total revenue.
In the early 1900s, Henry Ford revolutionized the automotive manufacturing industry by instituting the assembly line. What impact did the assembly line method for producing automobiles have on the per-worker production function for Ford?
A) It shifted down. B) It became flatter. C) It shifted up. D) It became linear.
The IMF agreement forced the U.S. to exchange gold for dollars at what price?
A) $25/ ounce B) $35/ ounce C) $45/ ounce D) $55/ ounce E) $20/ ounce
Suppose we were analyzing the Turkish lira per euro foreign exchange market. If The Euro-Area's tax level falls relative to Turkey and nothing else changes, then the:
a. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing an appreciation of the euro. b. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market rises, causing an uncertain change in the value of the euro. c. The supply of euros in the foreign exchange market rises, and the demand for euros in the foreign exchange market falls, causing a depreciation of the euro. d. The supply of euros in the foreign exchange market falls, and the demand for euros in the foreign exchange market rises, causing an appreciation of the euro. e. Neither supply nor demand in the foreign exchange market change because relative international prices influence trade flows and not the exchange rate.